Polish Minister of Digital Affairs Krzysztof Gawkowski has announced Poland wants to introduce a digital tax on big tech companies and the Trump administration has reacted by saying this would damage Polish-US relations. EPA-EFE/LUKASZ GAGULSKI

News

US threatens retaliation over planned Polish digital tax

Share

The US has warned Poland it will retaliate if Warsaw brings in a planned digital tax on Big Tech firms, calling the idea “not very smart”.

Newly appointed US ambassador to Poland Tom Rose said on March 10 that any attempt to impose additional costs on US corporations would automatically lead to a response from the Trump government. He urged Poland to think again. 

“It’s not very smart! A self-destructive tax that will only harm Poland and its relationship with the United States. President Trump will retaliate, as he should. Repeal the tax to avoid the consequences!” Rose wrote on platform X.

That was despite the fact that the tax has not yet been approved by parliament. 

Poland’s Deputy Prime Minister and digitalisation minister Krzysztof Gawkowski on March 10 announced the intention to introduce a digital tax on Big Tech companies during an interview with the Polish Press Agency (PAP).

According to Gawkowski, who represents the Left party in the centre-left coalition government led by Prime Minister Donald Tusk, a model for taxing revenues or profits of Big Tech companies was to be introduced this year. That was designed to enable the revenues from the new tax to support the development of Polish companies, start-ups in the digital-tech sector and the media.

“It could transfer profits from powerful global corporations, regardless of their place of origin, to the budget and they could then work for the development of Polish technology companies, support Polish start-ups, deep tech, cloud enterprises or the creation of quality content by the media,” Gawkowski said.

He added that similar taxes were in place in 35 countries, including France, Austria, the UK and Canada.

The digital tax had been actively promoted by European Union officials such as trade Commissioner Maroš Šefčovič. He has claimed the European market accounted for as much as 40 per cent of some US tech giants’ revenues.

In recent weeks, the Trump administration had repeatedly pointed to European digital taxes, regulations and penalties aimed at US corporations as examples of unfair treatment by the EU.

Trump and his secretary of commerce, Howard Lutnick, have warned that such trade barriers, including VAT, would be factored into tariff considerations intended to level the playing field in international trade.

Rose himself took to X in February to argue that VAT made it hard for fair trade to be conducted between the EU and the US.

That prompted Polish foreign minister Radosław Sikorski to respond: “If America had the sense to introduce VAT themselves they might be able to stop having to levy federal income tax.” 

During the first Trump administration (2016-2020), the then-US ambassador to Poland Georgette Mosbacher managed to change the last Conservative (PiS) Polish government’s mind about introducing a similar tax on Big Tech companies (in 2019).

Mooted restrictions on the operation of transport giant Uber were also abandoned along with attempts to make Disney Warner sell its majority shareholding in Polish commercial broadcaster TVN

While Trump’s administration had praised Poland and its government for spending more on defence as a proportion of GDP than any other NATO member, the new US administration has been critical of  Tusk’s policies with regard to public media and judicial reform.