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Jim Cramer: Europe Is Trying to 'Honeypot' the U.S.

Jim Cramer weighs in on the U.S. walking away from negotiations with Europe on an international digital services tax.

European countries are speaking out after the Trump administration withdrew from negotiations on an international digital services tax.

“Attempting to rush such difficult negotiations is a distraction from far more important matters,” Mnuchin said in the June 12 letter to four European finance ministers. “This is a time when governments around the world should focus their attention on dealing with the economic issues resulting from COVID-19.”

Treasury Secretary Steven Mnuchin informed European finance ministers last week, in a letter obtained by the Financial Times, that the negotiations at the Organization for Economic Cooperation and Development were at an “impasse” and said they should be put on hold while the countries addressed the coronavirus pandemic.

The U.S. was unable to agree even on an interim basis on changes to global taxation law that would affect leading U.S. digital companies. The U.S. wants to resume the talks later this year, Mnuchin said.

“The United States remains opposed to digital services taxes and similar unilateral measures,” Mnuchin said. “As we have repeatedly said, if countries choose to collect or adopt such taxes, the United States will respond with appropriate commensurate measures.” 

The French finance minister, Bruno Le Maire, said the U.S. decision was “a provocation."

“We were a few inches from an agreement,” he said on France Inter radio, the New York Times reported. “What is this way of treating the allies of the United States, by systematically threatening us with sanctions?”

So, what does this mean for tech stocks? Catch Cramer's take in the video above. 

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