Keir Starmer and Donald Trump in Secret Talks — Tech Tax U-Turn Deal Could Be Imminent!
Sir Keir Starmer and Donald Trump have had a private phone call to talk about a potential economic prosperity deal, Downing Street has confirmed—just as rumors swirl that the Government might ditch the Digital Services Tax, which targets tech giants like Amazon and Meta.
The call took place on Sunday night, according to the Prime Minister’s official spokesman, who said the two leaders discussed how talks on the deal were progressing. The timing couldn’t be more striking, with Chancellor Rachel Reeves reportedly considering changes to the tax ahead of the spring statement, reported the Express.
Asked directly whether the tax would be scrapped, the Prime Minister’s spokesman kept things vague, only saying that the UK is working with the US “on an economic prosperity deal” aimed at boosting economic security for both countries. He added, “The UK will only do a deal in the national interest, which reflects this Government’s mandate to deliver economic stability for British people.”
Pressed further, he insisted the Digital Services Tax remains “hugely important” to the UK, bringing in around £800 million a year and making sure companies “pay tax in the country that they’re operating in.” But he stopped short of denying that the tax could be up for negotiation, especially as part of the deal with Trump.
The Digital Services Tax, a 2% levy introduced in 2020, was designed to ensure big tech firms pay their fair share, especially those making massive profits off UK users without being physically based here. But the US has long been unhappy about it, and with Trump back in a position of global influence, he’s reportedly pushing hard to have it dropped—or else risk hitting the UK with a fresh wave of tariffs.
Chancellor Rachel Reeves added to the speculation, saying discussions were “ongoing” and that the Government was “talking” about the possibility of making tweaks to the tax. Though nothing has been confirmed, it’s clear the issue is now on the table as part of wider negotiations with the US.
It’s left many wondering if Starmer’s Government is preparing to cave to pressure from Washington in order to secure a broader trade win—and what that might mean for the UK’s stance on taxing big multinationals.
So while the official line is that any agreement will be in the national interest, the signs suggest the Government could be preparing to soften its approach on tech taxes to avoid getting stung by Trump’s next round of tariffs.