Trump escalates EU tech fight with new tariff threat
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President Trump and European Commission President Ursula von der Leyen at the G7 summit in France last month. Photo: Thibault Camus/Pool/AFP via Getty Images
President Trump threatened Friday to impose "a substantial tariff" on the European Union over the bloc's penalties against U.S. technology companies.
Why it matters: It opens a new front in the transatlantic trade dispute, with Trump signaling he's willing to use tariffs to retaliate against European regulation of American tech giants.
Catch up quick: The European Commission fined Google $1 billion this week under the bloc's Digital Markets Act, saying the company unfairly favored its own services and restricted app developers.
What they're saying: "The United States of America is not a 'PIGGYBANK' for Europe, nor will we allow it to be," Trump posted on Truth Social.
- Trump said he will initiate a trade investigation under Section 301 of the Trade Act of 1974, the administration's new — and more bureaucratic — go-to route for imposing tariffs.
- "The European Union will pay a very big price for this illegal and highly unethical conduct ... The penalties will be entirely reversed and, we anticipate, a substantial TARIFF to be placed on them at the earliest possible moment," Trump said.
Between the lines: The Google fine is part of a broader EU crackdown on Big Tech. Brussels also fined Apple and Meta last year, accusing the companies of abusing market power.
- The Trump administration argues the bloc's digital rules unfairly target America's biggest technology firms.
What to watch: Top Trump trade official Jamieson Greer warned this week that the bloc's escalating crackdown on American tech firms is raising tensions between the two blocs.
- Greer said the actions "pose a real risk to the continuation of transatlantic stability with respect to trade."
- "What I can tell you is we're not going to let Europe control the global regulation of our companies, which generally give a lot of free services to consumers and provide a lot of consumer welfare," Greer told Axios earlier this month.
Friction point: The tensions put the Trump-negotiated U.S.-EU trade deal at risk. If tariffs do materialize, they likely would take some time — Section 301 investigations can take months to play out.
- For their part, EU officials have previously insisted that any new tariffs would breach the trade deal.
The bottom line: Disputes over digital regulation are spilling over into trade policy, adding another source of uncertainty to one of the world's largest economic relationships.
