The US has withdrawn from negotiations with European countries over new international tax rules on digital firms, saying that the talks had made no progress because the rest of the world was insisting on making US companies pay tax in the same way as native companies. 

Nearly 140 countries are involved in the talks organised by the Organisation for Economic Cooperation and Development (OECD) on the first major rewrite of global tax rules in a generation to bring them up to date for the digital era.

The talks aim to reach a deal by the end of 2020, but it was not likely to happen with Washington’s latest move and the US presidential election in November.

“This letter is a provocation. It’s a provocation towards all the partners at the OECD when we were centimetres away from a deal on the taxation of digital giants”, Le Maire said on France Inter radio.

A Spanish government spokeswoman said Madrid and other European countries would not accept “any type of threat from another country” over the digital tax dispute.

European countries says tech firms pay too little tax in countries where they do business because they can shift profits around the globe with little physical infrastructure. Washington has resisted any new unilateral taxes on Silicon Valley

 European Economic Commissioner Paolo Gentiloni said the European Commission wants a global solution to bring corporate taxation into the 21st century.

“But if that proves impossible this year, we have been clear that we will come forward with a new proposal at EU level”, he said, saying taxes could be introduced even without a global deal.

France, one of several European countries which has enacted new taxes to collect more revenue from digital companies, had agreed to suspend collection of its levy while talks were under way on a global approach.

Le Maire said France would impose its digital services tax this year, whether or not Washington returned to negotiations.

“No one can accept that the digital giants can make profits from their 450 million European clients and not pay taxes where they are”, he said.

The French tax applies a three percent levy on revenue from digital services earned in France by companies with revenues of more than 25 million euro ($28 million) in France and 750 million euro worldwide.

Washington has threatened to impose trade tariffs on French Champagne, handbags and other goods hoping that would make France surrender rather than just pissing off fashion conscious US Yuppies.

President Donald Trump threatened this month to impose tariffs on EU cars if the bloc did not drop its tariff on American lobsters (no really).