The European Union has an ace in the sleeve to negotiate tariffs with the United States: digital services

The United States is the great world importer. Its economy is the paradigm of consumerism, and China – the great world factory – has taken advantage of it. Precisely Trump’s tariffs –now in pause in almost everyone– They intend to correct that deficit, but not only with China, but with everyone. And the European Union, one of the affectedhas its particular As in the sleeve: its deficit in services.

The EU is what the US to the goods. The European Union is a great services importer. In the old continent we are eager consumers of digital services that come from the US and ranging from the subscription to Netflix to the use of platforms such as Azure or AWS. The situation in services is similar to the one Trump wants to correct, but in that USA panorama it is “our China” and the EU would be the US. Europe has digital services deficit.

And von der Leyen knows. Ursula von der Leyen, president of the European Commission, has already made it clear that the shots can go in the negotiations for tariffs. As they point out in Financial Timesthe president indicated that the EU will seek a “completely balanced” agreement with Washington during the 90 -day truce to the application of the reciprocal tariffs announced by Trump a few days ago.

Trump makes the accounts that agree. The European Parliament already published a study Preliminary of what would happen if the US imposed extra tariffs on EU products, and detailed what the situation of imports of goods and services was. The US only talks about goods (Goods’) of consumption in its analysis, and does not mention the services for a simple reason: it has a deficit of goods (it loses) but surplus of services (it is winning).

The EU is losing in services, and if the US applies tariff

But it is that the US exports services to every cloth. As they also point out In The Wall Street JournalTrump’s mathematics ignore digital services exports. The former leading role of the United States as a manufacturer, with Ford or General Motors as great examples, has changed: now there the protagonists are the services, but the tariffs raised by the US government take them out of the equation, and that clearly affects the EU.

In danger. According to the European Parliament data, in 2023 the EU had a surplus of goods and USA had a service surplus. In the Global EU had a surplus of 48,000 million euros, but in the study they indicate that it is a modest figure that “only represents 3% of the total commercial flow, 1.6 trillion euros.”

Tariffs to services. If these negotiations fail, explained von der Leyen, the EU will expand the global trade war on services. The idea would be to include an income tax for digital advertising, something that already outlined with the DSA. The measure could have a remarkable impact on the income of companies that depend on the advertising model such as Meta, Google and Facebook.

Evening threats. “We are developing retaliation measures,” said Von der Leyen, noting that “there is a wide Ramgo of countermeasures … in the event that negotiations are not satisfactory.” The advertising tax would be applied in Europe and would be different from taxes to digital sales, which have independent tax burdens according to each Member State.

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