The European Union has stated that “everything is on the table” as it prepares its response—potentially targeting major US tech companies and increasing taxes on American products—if negotiations with Washington do not succeed regarding President Donald Trump’s broad new tariffs.
The European Commission, which oversees the EU’s trade policy, has refrained from disclosing specific details about what its response to Trump’s 20 percent tariffs, effective April 9, might entail.
However, suggestions from France, Germany, and Austria have pointed towards focusing on the largest digital firms, such as Google and Meta, the parent company of Facebook.
Here are the options being discussed by the 27-member European Union:
– Tariffs –
Following Trump’s imposition of a 25 percent tariff on steel and aluminum imports in March, the EU adopted an “eye for an eye” strategy.
As his additional tariffs would impact around $28 billion of EU exports, Brussels decided to target equivalent US goods from mid-April, which include products like Harley Davidson motorcycles and agricultural items such as soybeans and meat.
Now, with Trump’s newly announced 20 percent tariffs, discussions within the EU regarding further retaliatory measures have been reignited.
“We will respond in ways that impact the United States,” indicated a senior EU official.
Officials have noted that the EU aims to focus on goods from key politically significant US states, such as soybeans from Louisiana, the district of US Speaker Mike Johnson.
“We appreciate soybeans, but we can source them from Brazil,” the official explained.
“We enjoy Harley-Davidsons, but we’re also fond of MotoGuzzi. Or we can choose Yamaha. Thus, there are alternatives available which means we won’t harm ourselves.”
– Tech taxes? –
While the Commission has been discreet about the potential targeting of US Big Tech, France has boldly stated that the EU’s targets may include American technology giants.
French government spokesperson Sophie Primas suggested that the EU might “attack” online services that currently evade taxation.
Economy Minister Robert Habeck echoed this sentiment, asserting that “everything is up for consideration.”
In 2023, the United States boasted a surplus of 109 billion euros ($120 billion) in services with the European Union.
US firms dominate the financial services sector, including banks and payment systems like Mastercard, along with technology companies such as Amazon, Google, Meta, and Microsoft.
“If they plan to challenge our goods surplus, we will examine the services surplus,” noted an EU official.
Financial services could also be included among the targets, in addition to major tech companies, the official added.
“We are currently deliberating on this, and any decision will be made public as soon as it is finalized,” stated French Finance Minister Eric Lombard on Friday.
“It’s a signal to our American counterparts. However, we are developing a response package that could extend well beyond tariffs,” he told France’s BFMTV/RMC broadcaster.
– Trade tools –
An EU official declined to specify what methods Brussels might employ against the United States, but indicated that the bloc is considering the use of an anti-coercion instrument.
This measure, which was first adopted in 2023 but has never been implemented, punishes any country that uses economic threats to apply pressure on the EU.
Initially designed to counter trade pressure from China, it could now be leveraged against the United States.
With this tool, the Commission can act independently without unanimous support from all EU states.
This would enable the EU to restrict US firms’ access to public procurement contracts in Europe, a suggestion already made by France’s Primas as a potential consequence against Trump.
Officials believe that targeting US firms with EU regulations and taxes would not lead to increased prices for consumers in Europe.
“We are ready to implement strong, significant yet proportionate countermeasures,” stated EU trade chief Maros Sefcovic on Thursday.
Thus far, the EU has maintained a united front against Trump’s tariffs.
“Europe possesses all the necessary tools to weather this storm. We face it together,” remarked EU chief Ursula von der Leyen.
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