President Trump has threatened to impose a 100% tariff on French wines and champagne unless France eliminates its Digital Services Tax on major US tech companies. The ultimatum, delivered to outgoing President Emmanuel Macron, escalates tensions between the two nations ahead of the G7 summit in Evian.

France's DST, implemented in December 2019, targets tech giants like Apple, Amazon, and Meta with a 3% levy on local revenue. Companies must generate at least 750 million euros globally and 25 million euros within France to qualify. The tax generated approximately $700 million in 2025 revenue because it taxes sales volume rather than profits.

The American market represents roughly $2 billion in annual French wine sales, making the proposed tariff economically significant. Trump told The New York Post that removing the tech tax would eliminate US pressure, while White House officials referenced a February 2025 memo claiming American businesses should not 'prop up failed foreign economies.'

Legal questions surround whether Trump has authority for such tariffs after Supreme Court limitations on reciprocal trade measures. The tariff would impact importers rather than French exporters directly, though reduced sales could still harm the industry. This dispute highlights ongoing friction over international taxation of digital services.