US: Trump responds to France’s tax fight

According to a report from Reuters, Trump has landed a pre-emptive blow in a brewing fight over how to tax technology giants like Facebook. The US president on Wednesday initiated a probe into whether France’s digital levy unfairly targets American companies. The move gives him more leverage in talks about how to revamp international corporate tax but also means there’s more riding on the success of those discussions.

France’s plan to impose a 3% tax on the worldwide revenue of digital groups that generate at least 750 million euros of sales globally and 25 million euros in France aims to fix what Finance Minister Bruno Le Maire calls a “fiscal injustice”: tech giants paying little tax in large European countries.

The US probe means there’s a risk of US tariffs on French goods. Yet shares of companies like LVMH, Pernod Ricard, Kering and Airbus, whose products are imported to the United States, were little changed on Thursday.