By Josh Zumbrun

The Trump administration is taking the initial step to prepare tariffs against a range of trading partners unless they back off proposals to impose taxes that would fall heavily on the major American internet companies.

The Office of the U.S. Trade Representative said on Tuesday that it was beginning investigations into tax measures known as digital-services taxes that are being proposed or implemented in many countries as a way to tax commerce on the internet. The USTR said it was investigating a European Union-level proposal, as well as national proposals from Austria, Brazil, the Czech Republic, India, Indonesia, Italy, Spain, Turkey and the U.K.

"President Trump is concerned that many of our trading partners are adopting tax schemes designed to unfairly target our companies," said USTR Robert Lighthizer. "We are prepared to take all appropriate action to defend our businesses and workers against any such discrimination."

Tuesday's announcement is a replay of an aggressive tactic pursued against France last year in which the U.S. ultimately threatened that country with tariffs on $2.4 billion of goods. Though the French tax was ostensibly designed to target digital services in general, French officials often referred to the measure as the "GAFA tax" which stands for Alphabet Inc.'s Google, Apple Inc., Facebook Inc. and Amazon.com Inc. -- the American companies on whom such a tax would heavily fall.

After the U.S. formalized the steps to impose tariffs of up to 100% on imports like French wine, cheese, handbags and porcelain, France agreed to postpone the new tax until at least the end of 2020.

Despite the success of the U.S. strategy and its apparent focus on taxation, France considered the proposed tariffs a provocation and said that it could escalate to a trade war.

The step announced Tuesday doesn't specify which goods would be subject to tariffs, or how large the tariffs might be. As with the threatened tariffs against France, the USTR said it was launching the measures under Section 301 of the Trade Act of 1974, a law that gives the administration sweeping powers to impose sharp tariffs and was also used in carrying out the trade war with China.

Rather than individual countries coming up with piecemeal approaches to taxing internet companies, the U.S. has called for an approach in which countries agree to a framework for taxation developed by the Organization for Economic Cooperation and Development, a coalition of higher-income countries. Some countries, however, have moved forward with taxes without waiting for the OECD to finish a sometimes slow-moving process for developing the taxes.

The USTR said it had requested consultations with all the governments in question.

Write to Josh Zumbrun at Josh.Zumbrun@wsj.com

(END) Dow Jones Newswires

June 02, 2020 14:47 ET (18:47 GMT)

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