Big Tech’s tax bill is on the table in tariff talks

The United Kingdom is preparing to respond to the series of tariffs President Donald Trump has introduced since taking office. New taxes on everything from pure-bred horses to bourbon are on the table, but the Labour government seems more interested in a conciliatory approach, and it’s considering sacrificing a popular tax on American tech companies to sweeten the deal. Prime Minister Keir Starmer has confirmed that trade talks have included “questions about the appropriate way to tax digital services,” and The Guardian reports that UK negotiators have offered to water down the Digital Services Tax in exchange for lower tariffs, following earlier reports that UK negotiators were willing to scrap the tax entirely. It’s a move that could save Silicon Valley tech giants hundreds of billions, while mounting pressure on other governments worldwide to follow suit. In the UK, it would signal capitulation to American big tech—but pragmatically, some think it might not be a huge loss. The government itself admits the DST is meant to ensure that large businesses “make a fair contribution to supporting vital public services.” It’s as much about optics as it is about tax revenue, showing the British electorate that big tech is being made to pay its share.