US President Donald Trump has issued a stark warning to the United Kingdom, threatening substantial tariffs unless the nation abandons its digital services tax on American social media companies. The levy, introduced in 2020, imposes a 2 per cent charge on the revenues of several major US tech firms.
Trump’s Warning from the Oval Office
Speaking from the Oval Office on Thursday, Mr Trump said: “We’ve been looking at it and we can meet that 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.”
Details of the Digital Services Tax
The tax targets companies whose worldwide revenues from digital activities exceed £500 million, with more than £25 million of those revenues derived from UK users. Mr Trump claimed the laws, which have long been a source of tension in US-UK relations, targeted “top companies in the world”.
“The UK did it, a couple of other people did it,” he said. “They think they’re going to make an easy buck, that’s why they’ve all taken advantage of our country.”
Background and Previous Agreements
The digital services tax went unchanged under the UK–US trade deal agreed in May 2025, despite being a point of discussion. This latest threat comes months after similar US warnings to impose new tariffs and export controls on countries with digital taxes or regulations affecting American tech giants.
A number of European countries, including France, Italy and Spain, have their own digital services taxes.
Trump’s Stance on American Tech Companies
In a post on Truth Social from August 2025, Mr Trump said he would “stand up to countries that attack our incredible American Tech Companies”. He wrote: “Digital Taxes, Digital Services Legislation, and Digital Markets Regulations are all designed to harm, or discriminate against, American Technology.”
“This must end,” he added, vowing that “unless these discriminatory actions are removed”, he would “impose substantial additional tariffs” on the offending nation’s exports to the US.
Downing Street has been contacted for comment.
