Main takeout
- President Trump is ordering trade remedies for digital service taxes affecting US technology companies.
- Digital tax notes can affect the encryption company by introducing new regulations and tariffs.
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Today, President Donald Trump is preparing to sign a memorandum of instructions to the US trade representatives to develop trade remedies for foreign digital service taxes for US technology companies, including alphabets and meta platforms, that Bloomberg reported.
This initiative deals with digital service tax implemented by about 30 countries, including France, the UK and Canada, which the United States considers different.
The memorandum proposes potential retaliation measures that may affect internationally operated US companies, including the encryption sector, but not the exact tariff or timeline.
This action follows the initial US survey on digital service tax, including the 2019 USSTR survey, which is considered to be unbalanced to US companies.
Trump’s executive has previously investigated the digital tax system in France, Italy, Spanish and other countries, claiming that this policy is harmful to the US business.
After Canada implemented digital service tax in July 2024, and other countries maintained or developed similar measures, the US response could cause wider global trade and tax disputes.
Such disputes can affect potential blockchain companies and encryption exchanges.
Evolving the digital service tax can increase the investigation and tax obligations of encryption projects.
Companies that operate beyond the border can face the issue of compliance with new regulations as the government matches the tax system with global standards or implements new tariffs on digital transactions.
These additional costs can reduce trading activities by transferring market expansion or compulsory exchange to users.
Previous trade policy has already affected the encryption sector.
As of February 1, President Donald Trump’s announcement that he would impose tariffs on imports from Mexico, Canada and Europe, caused a wave of liquidation in the cryptocurrency market.
On February 3, Crypto Market experienced the largest liquidation event this year, and in 24 hours, more than $ 2 billion in the leverage position.
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