EU pushes back on Trump tariff threats as tech talks open in Washington

The European Commission struck a defiant tone on Monday as a senior delegation arrived in Washington for talks intended to stabilize a transatlantic digital relationship that has deteriorated sharply since Donald Trump returned to the White House. Roberto Viola, the Commission's director-general for communications networks, content and technology, is leading the EU side in meetings that run until Wednesday. The Commission describes the encounter as a "dialogue on a future potential dialogue", a formulation that captures both the fragility of the moment and the depth of the disagreement.

Tariff threat triggers formal pushback

The immediate catalyst was a post on Trump's social media platform on Friday threatening new tariffs against any European country that imposes digital service taxes on American technology companies. Several EU members, including France, Italy and Spain, have enacted such levies in recent years, arguing that large digital platforms generate significant value in their markets while paying minimal corporate tax. The US president's threat marks an escalation from the first Trump administration, which opened Section 301 investigations into the same taxes but stopped short of imposing duties.

Thomas Regnier, the Commission's chief spokesperson, told reporters in Brussels that the EU's position is "very clear". "The EU and its member states have the sovereign right to regulate any economic activities on their territory," he said. Regnier added that the bloc "will respond swiftly and decisively" should Washington follow through with "unilateral measures targeting such legitimate policies." The language mirrors the rhetoric the Commission used during the steel and aluminium disputes of 2018-2021, when the EU imposed rebalancing tariffs on American bourbon, motorcycles and orange juice.

Tech sovereignty package deepens the rift

Behind the tariff threat lies a broader clash over the EU's legislative agenda. In recent months the Commission has unveiled a package of measures designed to reduce Europe's structural dependence on US technology, a dependence that policymakers in Brussels, Paris and Berlin have come to view as a strategic vulnerability. The package includes provisions to nurture European cloud providers, semiconductor manufacturers and artificial intelligence developers, while giving national governments new tools to exclude non-European suppliers from sensitive public-sector procurement.

A spokesperson for the US State Department described those initiatives as "protectionist" in a statement to Politico on Sunday, arguing they risk undermining the partnership and recalling a recent trade agreement that "requires eliminating non-tariff barriers to trade." The same statement insisted that "the path forward is deregulation and collaboration on AI and chips." The formulation is revealing: Washington wants the benefits of cooperation on advanced semiconductors and artificial intelligence without accepting the EU's insistence on strategic autonomy in those same sectors.

Anthropic decision adds urgency to AI concerns

The temperature rose further last week when the US administration moved to partially lift export restrictions on the latest AI models from Anthropic, a San Francisco-based company whose systems are considered among the most capable in the world. The decision, taken over the objections of several European allies, means that advanced "superhacking" capabilities, models adept at finding and exploiting software vulnerabilities, could become available to a wider set of users, including actors the EU considers hostile.

European officials have long warned of a "tech kill switch" scenario in which US export controls or political decisions could cut off access to critical AI infrastructure. The Anthropic decision is seen in Brussels as proof that such a switch exists and that the Trump administration is willing to use it. Regnier did not rule out raising the issue of foreign access to AI models during this week's meetings, saying only: "We believe that we are a trusted partner, not a security risk."

Agenda reveals scope of disagreement

An internal preparatory document seen by Politico shows the Washington talks will cover artificial intelligence, cybersecurity, the online protection of minors, connectivity, semiconductors and digital trade. The breadth of the agenda reflects the fact that almost every layer of the digital stack is now contested. On AI, the EU's AI Act, which entered into force in August 2024, imposes obligations on foundation models that US companies argue are extraterritorial in effect. On cybersecurity, the EU's Cyber Resilience Act and the revised NIS2 Directive set security requirements for hardware and software sold in the single market. On chips, the European Chips Act aims to double the EU's share of global semiconductor production to 20% by 2030, partly through state aid that Washington views as distortive.

Regnier acknowledged the talks are "currently ongoing, which shows that both sides definitely want this." But the phrasing, "a dialogue on a future potential dialogue", suggests the two sides have not yet agreed on the premises for a structured negotiation. Andrew Puzder, the US ambassador to the EU, told Politico in March that Washington wants any tech dialogue to include a review of the EU's existing tech rules, which American companies say are too burdensome. The Commission has consistently refused to reopen legislation that has completed the ordinary legislative procedure.

Digital service taxes remain a flashpoint

The digital service tax dispute predates the current administration. France enacted its 3% levy on revenues from digital platforms in 2019, followed by Italy, Spain, Austria and others. The OECD-brokered global tax deal, Pillar One and Pillar Two, was meant to replace unilateral measures with a multilateral framework, but implementation has stalled in the US Congress. The Trump administration withdrew from the OECD negotiations in 2020; the Biden administration rejoined them but could not secure congressional ratification. With the global deal effectively frozen, European capitals have kept their national taxes in place, and the Commission has defended their right to do so.

The Commission's position rests on a distinction between taxation and regulation. Digital service taxes are fiscal measures adopted by sovereign member states. The EU's tech sovereignty package, by contrast, is regulatory. Washington conflates the two, treating both as discriminatory barriers to US firms. Brussels insists they are legally and politically separate. That distinction will be tested if Trump follows through on tariff threats, because the EU's response would likely target US goods and services across the board, not only digital ones.

Strategic autonomy versus alliance management

The deeper tension is strategic. Since the first Trump term, the EU has moved from assuming the US is a reliable guarantor of open markets and technological access to treating dependence as a liability. The war in Ukraine accelerated that shift: European governments saw how quickly US export controls could be applied to dual-use technologies, and how political decisions in Washington could affect the availability of satellite communications, cloud infrastructure and intelligence sharing. The tech sovereignty package is the legislative expression of that shift.

For Washington, the EU's moves look like protectionism dressed in security language. The State Department's call for "deregulation and collaboration" reflects a genuine preference for a transatlantic market governed by mutual recognition and shared standards, but on terms set largely by US industry. The EU's counter-preference is for a regulated market where access is conditional on compliance with European values and strategic interests. Neither side has shown willingness to compromise on the core principle.

The Commission's willingness to engage at all reflects a calculation that total decoupling serves neither side. European firms need access to US capital, talent and markets; US firms need access to the EU's 450 million consumers and its regulatory imprimatur. But the space for compromise is narrowing. Each side now treats the other's domestic politics as a structural risk rather than a cyclical irritant. That mindset, more than any specific tariff or regulation, is what makes the current moment different from previous transatlantic spats.