Tax bill contains 'sledgehammer' for Trump to retaliate against foreign digital taxes

 

\U.S. President Donald Trump would have the power to retaliate against countries that impose special digital service taxes on large U.S. technology companies like Amazon and Alphabet, under a provision in the sweeping tax bill that Congress is considering.

"If foreign countries want to come in the United States and tax US businesses, then those foreign-based businesses ought to be taxed as well," said Representative Ron Estes, a Kansas Republican who helped craft the provision.Some 17 countries in Europe and others around the world impose or have announced such taxes on U.S. tech products like Meta's Instagram. Germany announced on Thursday it was considering a 10% tax on platforms like Google.

The levies have drawn bipartisan ire in Washington. Democrats who oppose much of the tax bill have not spoken out against the retaliatory tax provision, found in Section 899 of the 1,100-page bill.

Trump has been pressing foreign countries to lower barriers to U.S. commerce. Under the bill, Congress would empower his administration to impose tax hikes on foreign residents and companies that do business in the U.S. The U.S. Constitution gives Congress, not the president, the power to decide on taxes and spending