Trump Threatens France with 100% Wine Tariffs Amid U.S. Tech Tax Dispute

In a blunt escalation of trade tensions, President Donald Trump has threatened to slap a 100% tariff on all French wines and champagnes entering the U.S., demanding France repeal its 3% digital services tax targeting American tech companies. This warning comes ahead of the G7 summit, stirring controversy over taxation and trade policies.

Trump said he personally urged French President Emmanuel Macron to drop the so-called 'GAFAM tax' aimed at the likes of Alphabet, Amazon, Meta, and Apple. If France refuses, the U.S. will have no choice but to impose the crippling tariffs on French wine exports - a market which pulls in over $2 billion annually and accounts for about 20% of global French wine sales.

This isn't just empty rhetoric; the 100% tariff level was initially proposed back in 2019 during a U.S. Trade Representative investigation into France's levy. Since its introduction in 2019, the tax has collected around $700 million in revenue as of 2025 according to French officials.

The matter appears far from resolved despite claims from the Élysée Palace last week that the dispute with the U.S. had been quietly settled among G7 nations. Washington officials have openly denied that any agreement was reached. This disagreement shines a light on the fractured transatlantic stance on digital taxation and market protections.

France's position is increasingly isolated as allies like Canada have scrapped their own digital service taxes after stalled negotiations with the U.S., and Italy is rumored to be reconsidering its policies. The UK remains a lone holdout, maintaining its levy within existing bilateral trade frameworks with the U.S.

Domestically, there is pressure within France to hike the tax rate, with the National Assembly voting overwhelmingly to double it to 6% last October. However, government ministers vetoed this move, and initial proposals to push the rate up to 15% were softened amid industry pushback.

The White House framed the stand-off with a hard line, pointing to a 2025 presidential memo that underscores a refusal to allow American firms to serve as cash cows for struggling foreign economies through 'extortive' taxes and fees.

With the G7 summit underway in Évian-les-Bains, this tariff threat adds fuel to an already tense pot of trade disputes. How this impasse over taxing digital giants and protecting national industries will unfold remains uncertain - but one thing's clear: American wine lovers might be paying close attention to their glass of Bordeaux in the coming months.