President Donald Trump has issued a stern warning to Britain and threatened to impose “major tariffs” in the coming months, marking a worsening of relations.
At the heart of the issue is the UK’s digital services tax policy which imposed a 2 percent levy on revenues generated by major US digital media companies.
Under this policy, only companies whose global revenues from digital activities exceed £500 million are eligible to pay the tax, which includes revenues of more than £25 million from UK shares.
The UK introduced this digital tax policy in 2020 and now the US wants Britain to remove it completely.
Speaking to reporters in the Oval Office, Trump said, “We are considering it and we could very easily accomplish it by imposing a huge tariff on the UK, so they better be careful.”
“If they don’t remove the tax, we’ll probably impose huge tariffs on the UK.”
Trump also argued that these laws are designed only to target the world’s top American companies. He accused Britain and other countries of making such discriminatory laws to take advantage of our country.
“They think they’re going to make easy money, so they’ve taken advantage of our country,” he said.
Asked how big the tariffs would be, Trump replied, “Much more than what they’re getting from the levy.”
Trump said, America will respond and its impact will be either equal to or greater than what Britain is doing.
When the US and UK reached a landmark trade deal in May 2025, the digital services tax remained unchanged despite being part of the discussion.
Since the start of the US–Iran war, US relations with Britain have also deteriorated as UK Prime Minister Keir Starmer has ruled out any possibility of involvement in the Middle East conflict. Starmer also rejected a US request to use British bases in the Middle East to launch attacks.
Downing Street has not yet commented on the US President’s remarks.
