• Trump threatens a 100% tariff on French wines unless a digital tax is rescinded.
• The digital services tax targets U.S. tech giants operating in France.
• French wine and spirit exports to the U.S. have already faced a drop.
• French President Macron opposes tariffs, advocating for stable trade relations.
• FEVS states the threat is detrimental to the export-oriented wine industry.

U.S. President Donald Trump has issued a stark ultimatum, threatening to impose a 100% tariff on French wine and champagne unless France abolishes its 3% digital services tax on American tech companies. This tax, enacted in 2019, targets revenues earned by U.S. giants like Facebook and Google operating within French borders. Trump stated that this impending tariff is not a matter of choice but rather a necessity if the French government does not relent, according to Reuters, SCMP, India Times, and Le Monde.

French President Emmanuel Macron is set to host Trump ahead of the G7 summit, and he has expressed that tariffs are counterproductive. Macron commented that he hopes for a “respectful but firm discussion” about the dispute, emphasizing that “tariffs don't do anyone any good”, particularly among G7 nations. He has called for stability in trade relations, demonstrating a clear disapproval of the proposed tariffs, according to Reuters, SCMP, and Le Monde.

The repercussions of this potential tariff could severely impact the French wine and spirits industry, which heavily relies on exports to the U.S., accounting for about 21% of total exports. Previously, these exports already faced a 15% tariff, and the French Federation of Wine and Spirits Exporters (FEVS) labeled Trump’s threat as “bad news” for the industry, voicing concerns over its vulnerability to external political disputes. Exports of French wines and spirits to the U.S. have plummeted by 21% last year, indicating a detrimental trend exacerbated by tariff threats, according to SCMP, India Times, and Le Monde.