Mnuchin: Trade deals boosting U.S. growth, Boeing 737 MAX a drag

Treasury Secretary Steven Mnuchin takes a question from a reporter after announcing the threat of sanctions on Turkey in the

Mr Javid said that while the United Kingdom would like to see an worldwide agreement, he planned to go ahead with the introduction of the new multibillion pound tax, which is due to take effect in April.

However, Javid said the tax - a 2% tax on search engine revenue, social media platforms and online marketplaces based on the value of United Kingdom users - will be introduced.

But he added: "When we look at the forecast for 2020, business looks very good and there is no question the two trade deals will have an impact".

France this week agreed to suspend a similar measure after the USA had threatened to impose new levies on French exports of wine, cheese and handbags.

At the World Economic Forum in Davos, Javid said: "We plan to continue with our digital services tax in April".

Last year, France introduced a 3% levy on the digital revenue of companies that make their sales primarily in cyberspace, such as Facebook Inc. and Alphabet Inc.'s Google.

France is also planning a digital tax and in response, Trump has threatened tariffs on French goods including wine. It is important that this is a proportional tax - as we said at the time we introduced it to Parliament and served as a legislator.

The UK has been urged to hold back on pressing ahead with the levy by the Organisation for Economic Co-operation and Development (OECD), which called for time to allow the push for an global approach to succeed.

The timing of the spat with the USA is hard, however, as talks are set to begin between London and Washington next week over a post-Brexit trade deal.

Mr. Mnuchin appeared with Mr. Javid in a panel in the Swiss ski area and said: "I'm sure the President and Boris will talk about it as well as the President with Macron".

"If people just want to arbitrarily levy taxes on our digital businesses, we will consider arbitrarily levying taxes on auto companies", he warned.

Le Maire insisted: "Digital companies will pay their fair tax in 2020".

"We've been pretty clear that we think the digital tax is discriminatory in nature", Mnuchin said.

"There is no point in leaving the EU and sticking to its rules and regulations forever", said Javid, noting that his country is leaving both the internal market and the customs union.

OECD chief Angel Gurria has told Britain to "hold fire" on its tax and told the BBC he feared there would be a "cacophony and a mess" with tit-for-tat tariffs. "This does require an worldwide solution and that is something I think we all agree on", he said.

Britain, which is scheduled to leave the European Union on January 31 and is keen to strike a trade deal with the well as with its former partners in the bloc, has become caught up in the dispute, too.

Euro traders are also becoming increasingly jittery over US-China trade relations, which are under strain following the "phase one" trade agreement.



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