UK seeks to avoid tariffs by negotiating tech tax

Britain is working quickly to avoid significant tariffs from US President Donald Trump, which are set to take effect on April 2. The UK had talks on Tuesday that were described as “productive.” The main focus was on the UK's digital services tax, which impacts major American companies. UK business secretary Jonathan Reynolds is urging his team to continue negotiations with Trump's trade representatives. The goal is to reach an agreement that would lessen the impact of harsh US tariffs on British goods. US officials have expressed concerns about the UK's tax on companies like Alphabet and Facebook. Although the UK Treasury plans to keep the £800 million annual tax, discussions about it are ongoing. UK officials believe that some tariffs will still apply, but they hope to minimize the rates. Reynolds met with several US trade officials in Washington to discuss these issues. While they recognize that the US has a higher bargaining position, they are optimistic about potential trade agreements focusing on technology. US Treasury secretary Scott Bessent stated that tariffs will vary by country. This means some nations will face lower tariffs, while others might be more heavily impacted. Trump’s policies especially target the EU, which could strain UK-EU relations. Despite these challenges, UK Prime Minister Sir Keir Starmer and Trump have agreed to work together on an “economic prosperity deal.” The UK Department of Business and Trade expressed eagerness to advance this deal in the coming weeks and months.