U.S. Reps. Jason Smith (R-MO), Mike Kelly (R-PA), and Adrian Smith (R-NE), who serve on the U.S. House Ways and Means Committee, jointly slammed a plan being considered in France to increase its digital services tax (DST) from 3 percent to 15 percent and raise the applicable revenue threshold to levels that specifically target American innovators.
“France’s proposed increase in its digital services tax would be an unwarranted attack on America’s digital companies and leave the U.S. Congress and the Trump administration with little choice but to pursue aggressive retaliatory actions,” said Rep. Jason Smith, House Ways and Means Committee chairman; Rep. Kelly, chair of the committee’s Subcommittee on Tax; and Rep. Adrian Smith, who chairs the committee’s Subcommittee on Trade, in an Oct. 28 statement.
They pointed out that congressional Republicans have been “consistently adamant” that they will not abide by France nor any other country that imposes discriminatory taxes against American businesses.
“President Biden lacked the courage to use trade policies to defend America’s interest and gave away leverage by pausing Section 301 investigations that the Trump administration began against DSTs around the world,” the lawmakers said. “President Trump has proven time and again that he will staunchly defend American workers, producers, and innovators against unfair trade practices and discriminatory tax regimes — with proven results.”
The members also added that should France move forward with raising its DST to target American digital companies, the Ways and Means Committee will work with Trump to respond accordingly.
“For example, when the OECD’s [Organization for Economic Co-operation and Development’s] global tax scheme threatened to unfairly tax American businesses, Ways and Means Republicans did not hesitate to introduce and advance legislation through the U.S. House of Representatives to protect our nation’s interests overseas,” they said in their joint statement. “We will defend American workers and businesses by making clear to all nations that it’s better to work with the U.S. than against us.”