UK refuses to again down on US tech tax regardless of Trump’s tariff menace | EUROtoday

Sir Keir Starmer has refused to again down on Britain’s tax on American social media corporations, regardless of Donald Trump threatening to hit again with tariffs.

The digital providers tax, launched in 2020, imposes a 2 per cent levy on the revenues of a number of main US tech corporations – one thing Downing Street has insisted is “fair and proportionate”.

Speaking to reporters from the Oval Office on Thursday, Mr Trump warned the US might retaliate “very easily by just putting a big tariff on the UK, so they better be careful”.

“If they don’t drop the tax, we’ll probably put a big tariff on the UK,” he stated.

But the UK has hit again, saying its place on the matter has not modified.

Asked about Mr Trump’s threats, the prime minister’s official spokesperson stated: “Our position on that is unchanged. It is a hugely important tax to make sure that those businesses continue to pay their share. So it is a fair and proportionate approach to taxing business activities in the UK.”

The tax targets corporations whose worldwide revenues from digital actions exceed £500m, with greater than £25m of the income from UK customers.

According to a 2025 Treasury assessment, the levy raised greater than £800m in 2024-25, up from £678m in 2023–24.

Mr Trump argued the legal guidelines, which have lengthy been a supply of stress in UK-US relations, focused “top companies in the world”.

“The UK did it, a couple of other people did it,” he stated. “They think they’re going to make an easy buck, that’s why they’ve all taken advantage of our country.”

The digital providers tax was not modified when the UK–US commerce deal was agreed in May 2025, regardless of being a scorching subject of dialogue.

Asked how excessive any retaliatory tariffs could be, the president stated it might be “more than what they’re getting” from the levy.

“What we’ll do is we’ll reciprocate by putting something on that’s equal or greater than what they’re doing,” he stated.

The newest remarks add to wider strains in UK-US relations, which have deteriorated after Sir Keir Starmer dominated out British involvement within the Iran battle.

On Friday, Downing Street was compelled to reply following stories that the US might assessment Britain’s declare to the Falkland Islands as revenge for an absence of assist within the Iran battle.

No 10 hit again on the stories, insisting the UK’s place on the Falkland Islands “isn’t going to change” and that “sovereignty rests with the UK”.

Meanwhile, earlier this month, Mr Trump advised the phrases of the UK-US commerce settlement brokered final yr “can always be changed” in an interview with Sky News.

Mr Trump’s newest threats regarding the digital providers tax come months after related US threats to impose new tariffs and export controls on nations with digital taxes or laws affecting American tech giants.

A variety of European nations, resembling France, Italy and Spain, have a digital providers tax.

In a put up on Truth Social in August 2025, Mr Trump stated he would “stand up to countries that attack our incredible American Tech Companies”.

“Digital Taxes, Digital Services Legislation, and Digital Markets Regulations are all designed to harm, or discriminate against, American Technology,” he wrote.

“This must end,” he stated and vowed that “unless these discriminatory actions are removed”, he would “impose substantial additional tariffs” on the offending nation’s exports to the US.

Liberal Democrat chief Sir Ed Davey stated: “Now Trump is threatening to hit Britain with tariffs unless we give in and slash taxes for US tech barons like Elon Musk.

“Why is Keir Starmer rewarding this bullying behaviour with a state visit from the King?”