Trump threatens 100% tariffs on EU over tech taxes, upending fresh trade deal

President Trump threatened on Friday to scrap a trade deal the European Union had finalized just days earlier, claiming he would impose 100 percent tariffs on European countries unless they abandon their digital services taxes, according to the New York Times. The threat comes as Europe faces mounting economic pressure from multiple directions: the tariff threat itself, broader US trade tensions, and the continent's own sluggish growth. The timing underscores the fragility of any agreement in the current US administration's approach to transatlantic relations.

The digital services taxes that triggered Trump's threat target large technology companies—many of them American—that generate substantial revenue in Europe while minimizing their tax footprint. France, Spain, Italy and other EU states have pursued such levies as a way to capture tax revenue from digital platforms. The EU had sought to resolve the dispute through negotiation, but Trump's sudden reversal signals his willingness to use tariff threats to overturn multilateral agreements his administration views as unfavorable.

Italy, as a eurozone member and G7 participant, stands at the intersection of these tensions. Italian exporters already face uncertainty from earlier Trump tariff threats and the ongoing trade disputes. The threatened 100 percent tariffs would likely disrupt supply chains and trade flows across Europe, with particular impact on Italy's manufacturing and luxury goods sectors, which depend on transatlantic commerce. The New York Times reported that it remains unclear how soon Trump could impose any tariffs, but the threat itself signals a willingness to unwind recent diplomatic progress.

The episode also reflects broader strains in US-Europe relations that have preoccupied Italy's government. Prime Minister Meloni has sought to balance alignment with Washington against Italy's EU commitments, a tension that has played out in disputes over Iran policy and NATO burden-sharing. Trump's casual destruction of a freshly negotiated EU agreement demonstrates the unpredictability that Rome must now factor into its own diplomatic calculations—a challenge compounded by the earlier tensions between Trump and Meloni over a disputed photograph at the G7 meeting in France, as reported by the Guardian.