Last Tuesday, Treasury Secretary Scott Bessent addressed the Digital Services tax. Countries like France and Italy are using it against our great technology companies. He clarified that it is a sticking point. It needs to be settled before broader trade negotiations can take place. The tax burdens US firms and favors China, undercutting joint competition with China.
A reporter asked Secretary Bessent about negotiations with Europe. He explained that in Europe, the US engages with many different countries.
“We’re negotiating with a lot of different interests,” Bessent said at a White House press conference Tuesday. “Some of the European countries have put on an unfair digital service tax on our big internet provider — France and Italy — other countries, Germany and Poland, don’t have that. So we want to see that unfair tax of one of America’s great industries removed. It’s going to be a give and take. They have some internal matters to decide before they can engage in an external negotiation.”
Countries like France and Italy use digital service taxes to earn revenue from Google, Meta, and Amazon. They use the excuse that it’s to address corporate tax avoidance. Still, the US administration said they are actually after revenue at US expense. It is by countries “that have failed to cultivate economic success of their own.”
EU’s Censorship Regulatory Regime
The EU claims it is “to prevent illegal and harmful activities online and the spread of disinformation. According to them, it ensures user safety, protects fundamental rights, and creates a fair and open online platform environment.”
If Europe works with the US, it will deliver a blow to a shared adversary, China.
Daily Caller reports:
According to the Information Technology and Innovation Foundation, between 2013 and 2023, U.S. digital services exports to the EU jumped from $12.8 billion to $17.9 billion. Yet, American firms were hit with roughly $5.3 billion in data privacy fines — more than 83% of all such penalties levied under Europe’s General Data Protection Regulation (GDPR) framework.
American workers and businesses have long been frustrated by the unfair tariffs and burdensome regulations imposed by European countries to gain an economic advantage. Europe targets our most productive and fastest-growing tech industry.
Brussels is pushing ahead on the Digital Markets Act and the Digital Services Act. It looks like the EU is building a legal environment that singles out American firms while giving Chinese competitors a pass. This is censorship and industrial sabotage. The EU frames it as “fair and open digital markets” because it needs a good excuse, one it thinks we can’t rebut.
The dangerous DSA:
The EU Digital Services Act now threatens Americans with fines for speech that would be protected under our First Amendment.
They’ve already threatened a billion-dollar fine against X for “non-compliance with disinformation” standards. pic.twitter.com/rKrYrz548z
— Karl Mehta (@karlmehta) April 29, 2025
If they do the right thing, it will isolate China.
JD Vance addressed it at the Paris AI Summit in February:
“The Trump administration is troubled by reports that some foreign governments are considering tightening the screws on U.S. tech companies with international footprints,” Vance said. “Now, America cannot and will not accept that, and we think it’s a terrible mistake not just for the United States of America but for your own countries.”
Watch the short clip:
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