What happened
Trump posted to Truth Social early Sunday demanding France repeal its digital services tax or face a 100% tariff on wine imports into the United States. The post, flagged by CryptoBriefing at 06:14 UTC, named no implementation date but described the response as 'immediate' once France formally rejects repeal. A senior White House trade official, speaking on background, told reporters the tariff order is drafted and awaiting signature.
France's 3% DST has been in force since 2019 and applies to digital revenue, not profit, from companies with more than €750 million in global digital sales and €25 million in French sales. The tax raised roughly €700 million for Paris in its last full reporting year. Trump's first administration opened a Section 301 investigation into the same tax in 2019 and threatened tariffs on French champagne, handbags, and cosmetics before a truce was reached at the OECD level.
That OECD framework, the so-called Pillar One deal, has stalled. France kept its DST in place. The White House views Sunday's threat as a reopening of that fight.
Why it matters
The French DST has always been about US tech. Google, Meta, Amazon, and Apple are the main payers, and the levy has been a template other EU members have copied or considered. Italy, Spain, and the UK run variants.
A successful US pushback against Paris would weaken the broader European digital tax regime. The crypto angle is less obvious but real. EU regulators have spent the past two years discussing whether crypto exchanges, stablecoin issuers, and large wallet providers should fall under digital services tax scope.
France's Autorite des Marches Financiers raised the question in a 2025 consultation paper. Brussels has not ruled it in or out. If the DST survives this round of US pressure and expands its definition of 'digital services' to include crypto custody or trading venues, US-headquartered exchanges like Coinbase and Kraken with European subsidiaries would face the same 3% top-line hit.