Trump Threatens 100% Tariff On French Wine Over Tech Tax

President Donald Trump is threatening France with 100% tariffs on wine and champagne unless Paris scraps its 3% digital services tax on U.S. tech companies. The warning came hours before Trump departed for the G7 summit, with the U.S. saying it will “have no choice” but to apply the tariffs if Macron does not end the levy on large digital services companies.

What Trump actually said

“I asked him not to charge American companies, and if they do, I have no choice but to charge a 100% tariff on all champagnes and all wines coming out of France,” Trump told the New York Post in an interview.

The comments appeared to contradict claims from Macron’s office last week that the dispute was no longer under debate among G7 countries, with a U.S. official dismissing that account as inaccurate.

The tax in question

France’s digital services tax, often called the GAFAM tax, has been in force since 2019 and applies a 3% levy to revenue earned in France by large digital companies with more than about $29 million in French revenue and about $870 million in global revenue. The targets are U.S. names like GOOGL, AMZN, META, and AAPL.

The GAFAM tax raked in roughly $700 million in 2025 alone, according to the French finance ministry.

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Why wine is the pressure point

The U.S. is one of France’s largest wine export markets, accounting for roughly a fifth of global sales, worth more than $2 billion annually. A 100% duty would effectively double landed costs for importers and distributors.

Wine exports from France to the U.S. fell 15.9% in value in 2025 to 1.9 billion euros, from 2.4 billion euros in 2024, according to the American Association of Wine Economists. The category is already softening before any new tariff hits.

Precedent: Canada folded

Canada dropped its digital services tax last year in an effort to preserve trade negotiations with the United States following pressure from Trump. That is the template the White House is now pointing at Paris.

In January, Trump threatened to impose 200% tariffs on French wine after France signalled it would decline an invitation to join his proposed “Board of Peace,” aimed at resolving international conflicts.

Options market and stocks to watch

Watch for movement in the names most exposed to either side of this fight:

GOOGL, AMZN, META, and AAPL are the direct GAFAM targets — a French climbdown would remove a recurring tax overhang for each.

DEO and BF.B are worth watching on the beverage side, as any escalation on EU alcohol duties reshapes pricing and shelf share for distributors and domestic substitutes. Keep an eye on other news out of the G7 for follow-on tariff headlines.

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