Washington – U.S. federal agencies are coming together to defend U.S. companies that are facing discriminatory taxes and regulations as they seek to do business in foreign markets. The action comes in response to an executive order, President Trump directed the Administration Friday to investigate a wide range of discriminatory foreign practices targeting U.S. digital exports.
In the Executive Order titled, “Defending American Companies and Innovators From Overseas Extortion and Unfair Fines and Penalties,” the Office of the U.S. Trade Representative is directed to review digital services taxes (DSTs) abroad, and, in tandem with the Dept. of Treasury and Dept. of Commerce, is directed to investigate regulations that could “inhibit the growth or intended operation of United States companies,” policies that could threaten U.S. companies’ intellectual property, and policies abroad that could “undermine the global competitiveness of United States companies.” Other directives of the Executive Order include securing a permanent moratorium on customs duties on electronic transmissions with U.S. trading partners and reviewing policies in the European Union and United Kingdom that involve expression online.
The Computer & Communications Industry Association has long called for effective enforcement against discriminatory and burdensome measures affecting U.S. suppliers in foreign markets. CCIA recently released its priority list of digital trade barriers abroad, founded on CCIA’s research into the hundreds of obstacles to U.S. digital products and services exports globally.
In addition to the executive branch, Congress is also considering how to advance U.S. exports. CCIA’s Vice President for Digital Trade Jonathan McHale will be offering examples of trade barriers including discriminatory taxes and regulations when he testifies at a House Ways & Means Committee subcommittee hearing Tuesday on “American Trade Enforcement Priorities.” Digital trade accounts for $655.5 billion of U.S. services exports annually and helps counter-balance the trade deficit in goods.
The following can be attributed to CCIA Vice President for Digital Trade Jonathan McHale:
Response to E.O.:
“We are encouraged that the Administration plans to take action and investigate the range of discriminatory and burdensome measures affecting U.S. digital firms in key foreign markets. We look forward to working with the Administration to help address the myriad measures affecting our members that fall within the scope of this initiative, with the ultimate goal of promoting cross-border trade in digital products and services and restoring fair trading practices with important U.S. partners.”
Preview of hearing testimony:
“For too long our trading partners’ discriminatory taxes or regulations have gone unchallenged and we appreciate the attention to digital trade, which is a bright spot in countering the trade deficit. CCIA is tracking measures in 54 countries in key areas like restrictions on cloud computing and data localization and discriminatory digital service taxes and platform regulations.”
