The United States said Tuesday that it is launching a probe into the digital services taxes being considered or adopted by its trading partners such as the European Union
Italy, Brazil and other countries, a move that could lead to imposing punitive tariffs.
“President Trump is concerned that many of our trading partners are adopting tax schemes designed to unfairly target our companies,” U.S. Trade Representative Robert Lighthizer said in a statement.
“We are prepared to take all appropriate action to defend our businesses and workers against any such discrimination,” he added.
The investigations will be conducted under Section 301 of the 1974 Trade Act. This provision gives the U.S. Trade Representative’s office broad authority to investigate and respond to a foreign country’s action which may be unfair or discriminatory and negatively affect U.S. Commerce.
In a Federal Register notice, the USTR said the probe would cover digital services taxes adopted or under consideration by Austria, Brazil, the Czech Republic, the European Union, India, Indonesia, Italy, Spain, Turkey and Britain. The trade agency said it has requested consultations with these governments.