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Macron Says Digital Tax Deal With US Reached, As Trump Deflects

Macron Says Digital Tax Deal With US Reached, As Trump Deflects

French President Emmanuel Macron on Monday claimed that the U.S. and France reached a deal regarding France's digital tax framework, after the Office of the U.S. Trade Representative started a Section 301 investigation on the matter in July.

Section 301 of the Trade Act of 1974 provides for the imposition of trade remedies, including tariffs, if the U.S. finds that other countries are engaging in unfair trade practices.

Macron delivered the statement during a press conference alongside President Donald Trump on the final day of the G7 summit in Biarritz, France.

But when asked whether the U.S. and France had reached an agreement on digital taxation, Trump stopped short of confirming that any such deal was sealed.

He was responding to a reporter's two-part question during the press conference about whether Trump would follow through on a threat he made Sunday to impose tariffs on French wine and whether he could confirm that the U.S. and France reached an agreement on digital taxation.

"I can confirm that the First Lady loved your French wine, OK?" Trump said, according to a White House transcript of the press conference. "All right? She loved your French wine. So, thank you very much. That's fine."

France will do away with its national digital services tax when an international tax is imposed on digital services, at which point everything paid under the French tax system will be reimbursed, Macron said, according to his transcribed remarks, which were translated into English.

"The aim, ultimately, is to find an agreement internationally by 2020 to revamp international tax systems within the framework of the [Organization for Economic Cooperation and Development] to combat harmful trade practices, which are also harmful to the U.S. economy," Macron said.

France implemented a 3% tax in July that applies to firms with annual global revenues from digital services of at least 750 million euros and annual revenues from France of at least 25 million euros.

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