U.S. and France Race to Conclude Digital Tax Talks as Tariff Threat Looms

on Jan8
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“If the Americans start to hit France with sanctions because it has introduced national digital taxes, it will have to go tomorrow to also hit Italy, Austria, Great Britain,” Mr. Le Maire said. “We will enter a commercial conflict between the United States and Europe.”

Mr. Trump and many of his supporters have argued that tariffs on foreign goods do not have much effect on American companies, and have largely dismissed complaints like those shared at Tuesday’s hearing. Other officials have acknowledged that the tariffs impose some costs on American businesses, but have argued the price is worth it to secure other changes.

The businesses that are paying the levies have protested, and loudly.

Ms. Taylor, the wine expert, said she had woken up at 2 a.m. that day to get to Washington, and insisted on testifying before the panel disbanded early, before an afternoon snowstorm. Her passionate testimony was followed by cheers and applause from dozens of wine merchants in the audience of a normally staid hearing room.

Other executives complained Tuesday that the tariffs would cause them to put the brakes on hiring or expansion plans, and could force their businesses to close altogether.

Faye Gooding, the recently retired chief executive of Le Creuset of America, called the tariff “an existential threat” to the company’s existence in South Carolina.

Le Creuset’s candy-colored Dutch ovens — which feature prominently on many American wedding registries — are manufactured in France. But the company employs more people in warehouses and retail locations in the United States than in any other country, Ms. Gooding said. A tariff of up to 100 percent on the company’s premium cookware could prove catastrophic for its about 900 American employees, including around 300 in South Carolina, she said.

Benjamin Aneff, the managing partner of Tribeca Wine Merchants, called the prospect of a tax on French wine and champagne the “greatest threat to the industry since Prohibition.” Even if wines originate in France, they are typically sold in the United States by American distributors and retailers, businesses that would be hurt by higher taxes, he said.

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