President Donald Trump has threatened to impose a 100 percent tariff on all French wine and champagne imports unless France removes its three percent digital tax on US tech companies, according to a report from The New York Post published ahead of the G7 conference in France.
Trump Threatens 100% Tariff on French Wine
"I asked [French President Emmanuel Macron] not to charge American companies, and if they do, I have no choice but to charge a 100 percent tariff on all champagnes and all wines coming out of France," the President told The New York Post, as reported by Engadget. The threat comes despite recent signals from French sources close to Macron that the issue "was no longer up for debate," according to the Post.
The Digital Services Tax (DST) at Issue
France's so-called "GAFAM" tax — targeting Google, Apple, Facebook, Amazon, and Microsoft — is levied on gross, not net, revenue earned by those tech giants. Imposed in 2019 as part of a deal with the first Trump administration, the tax generates around $700 million per year in revenue for France. In contrast, French wine and champagne sales in the US are worth at least $2 billion, according to Engadget.
The French lower house recently voted to double the digital tax to six percent, but that was vetoed by ministers over the risk of US reprisals. Eliminating the tax would be a political gamble in France, as a large chunk of voters are concerned about dependence on US tech.
Previous Actions and Global Reactions
Trump is increasingly seen as an attack dog for big tech, using tariffs as a cudgel to force nations to drop digital taxes and levies, Engadget reported. US companies have also urged Trump to punish nations like Australia over social media bans and the use of news media in search results. Canada repealed its digital tax in 2025 following pressure from the Trump administration. Other blocs have resisted, including the UK which has retained its own two percent digital services tax.
A comparison of the key figures:
| Item | Value |
|---|---|
| French digital tax rate | 3% (proposed increase to 6%) |
| Annual revenue from French DST | ~$700 million |
| US wine & champagne imports from France | At least $2 billion |
| Proposed US tariff rate | 100% |
| UK digital services tax | 2% |
| Canada digital tax status | Repealed in 2025 |
What Comes Next: Bluff or Real Action?
The US President often makes tariff threats, so the latest could be another "Taco" bluff designed to extract concessions in other areas, Engadget noted. And if the wine levy were applied, it could be quickly slapped down in a trade court like Trump's previous tariffs. Still, it will no doubt precipitate one or more sit-down sessions between the US and French heads of state at the G7.
Sources:
