Trump Threatens UK Tariffs Over Digital Tax on US Tech Giants

President Donald Trump threatened to impose tariffs on the United Kingdom Thursday, escalating a dispute over Britain’s digital services tax that targets major American technology companies.

Speaking from the Oval Office, Trump issued a stark ultimatum over the UK’s 2% levy on revenues from tech giants including Apple, Google, and Meta. “If they don’t drop the tax, we’ll probably put a big tariff on the UK,” he warned reporters.

The digital services tax, implemented in 2020, applies to companies generating worldwide digital revenues exceeding £500 million with more than £25 million derived from UK users. Trump characterized the policy as Britain attempting to “make an easy buck” from American firms.

Economic Stakes Rise

The levy has proven lucrative for Britain’s Treasury, collecting approximately £800 million in the 2024/25 financial year. Projections suggest the tax could generate between £4.4 billion and £5.2 billion through 2029.

Trump indicated any retaliatory measures would be “equal or greater than what they’re doing,” signaling potential economic consequences for both nations. The threat comes as UK-US relations face broader strains, particularly over Middle East policy.

Longstanding Friction Point

The digital services tax has remained a persistent source of tension between Washington and London. The Trump administration has consistently characterized the levy as discriminatory against US businesses, arguing it unfairly targets what the president called “top companies in the world.”

The dispute reflects wider global tensions over how to tax multinational technology corporations that generate substantial revenues across borders while maintaining limited physical presence in many jurisdictions.

Neither the UK Treasury nor the targeted technology companies immediately responded to requests for comment on Trump’s latest threats.