On February 21, 2025, President Donald J. Trump issued a memorandum (the “Memorandum”) directing the Secretary of the Treasury, the Secretary of Commerce, and the United States Trade Representative to broadly address foreign taxes and regulations that target American companies, focusing largely on the digital economy. The Memorandum (i) instructs the United States Trade Representative to consider renewing or initiating investigations under Section 301 of the Trade Act of 1974 into foreign countries’ discriminatory digital services taxes; (ii) directs U.S. agencies to consider imposing tariffs and other measures in response to such countries’ taxes or regulations that are designed to extract funds or intellectual property from U.S. businesses; (iii) directs the Secretary of the Treasury to determine whether any foreign tax regimes violate U.S. tax treaties or warrant action under existing tax laws; (iv) calls for a permanent moratorium on customs duties for electronic transmissions; and (v) establishes a new reporting process for U.S. businesses to identify harmful foreign tax or regulatory practices.
View other S&C insights relating to President Trump’s recent executive orders.