US and France agree tariff truce for a year
Phoebe French - Source: www.thedrinksbusiness.com
After the US government threatened up to 100% tariffs on US$2.4 billion worth of French goods, including wine, American President Donald Trump and the French President Emmanuel Macron have agreed to a truce for a year.
Back in December 2019, the US government proposed additional tariffs of up to 100% on French goods including wine, cheese and handbags in retaliation to France's digital services tax.
Dubbed GAFA (an acronym for ‘Google, Apple, Facebook and Amazon’), France’s digital tax would impose a 3% levy on the total annual revenues of the largest global technology companies providing services to French consumers.
The dispute had been brewing for some months. In July 2019, President Trump promised to announce “substantial reciprocal action” to what he called “[President] Macron’s foolishness”. However in the following month, an agreement was reached to suspend the spat. It was later rekindled in December.
In a tweet posted on 20 January, President Macron wrote that he’d had a “great discussion” with President Trump and that the two countries would “work together on a good agreement to avoid tariff escalation”. President Trump posted the word “excellent” in response to the tweet.
A French diplomatic source told various media outlets that Macron and Trump had decided to hold off on any further tariffs until the end of the year. The two leaders would continue negotiations at the Organisation for Economic Cooperation and Development (OECD) on the digital tax issue during that period.
Read the full article at: https://www.thedrinksbusiness.com/2020/01/us-and-france-agree-tariff-truce-for-a-year/