The United States and France have reached a deal over a French tax expected to hit Silicon Valley’s largest companies that heightened tensions between the two countries, French President Emmanuel Macron said Monday.
The 3% tax on revenue generated by big tech companies that provide digital services to French users, which the U.S. believes unfairly targets American firms, was signed into law by Macron in July, prompting President Trump to threaten tariffs on French wine.
But Macron told reporters during a press conference at the G-7 summit in Biarritz, France, the U.S. and France reached a “very good agreement” over the digital services tax.
“We’ve done a lot a work on the bilateral basis, we have a deal to overcome the difficulties between us,” he said standing alongside Trump.
Macron reiterated the French tax would be dropped once the Organization for Economic Cooperation reaches a multilateral agreement on taxation in the digital era. The Organization for Economic Cooperation is aiming to agree to a long-term solution by the end of 2020.
Once the international tax deal is reached, Macron said companies who paid under the French tax system would be reimbursed.
“I think we will work together in the spirit of cooperation on this,” he said.
