Trump warns France to repeal tech tax or face 100% wine tariffs

President Donald Trump has told France to scrap its digital services tax or watch American tariffs on French wine and champagne hit 100%. The ultimatum, delivered through an interview with the New York Post, marks the sharpest escalation yet in a transatlantic trade fight that started seven years ago.

Trump said he had personally asked French President Emmanuel Macron to eliminate the tax.

A tax designed with Silicon Valley in mind

France first enacted its digital services tax in 2019 at a rate of 3%. The levy was designed to target large tech companies, specifically firms like Google, Amazon, Apple, and Meta, that generate significant revenue in France but structure their operations to minimize local tax obligations.

The tax immediately drew fire from Washington. The US argued it was discriminatory because it disproportionately affected American companies. The Trump administration’s first round of tariff threats in 2019 targeted French wine and luxury goods, but those measures were suspended while the OECD attempted to broker a multilateral agreement on how to tax digital businesses internationally.

In late 2025, French policymakers floated proposals to increase the DST rate, with discussions suggesting the levy could climb as high as 15%. That’s a fivefold increase from the original 3% rate.

The wine industry caught in the crossfire

A 100% tariff would effectively double the price of every bottle of French wine sold in America. That $30 bottle of Burgundy becomes a $60 bottle.

What this means for investors

If France does repeal the DST, companies like Google, Amazon, Apple, and Meta would see a meaningful reduction in their European tax burden. The LVMH and Kering portfolios, which include some of France’s most prestigious wine and spirits brands, would face direct exposure to a 100% wine tariff.

Other European countries have implemented similar digital services taxes. If Trump successfully pressures France into repealing its version, it sets a precedent that could reshape digital taxation policy across Europe.

Notably, this dispute has stayed entirely within the lanes of traditional trade policy, with no cryptocurrency or digital asset implications in the fight.

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