Britain has put the tech tax and online safety laws on the table in negotiations with the US about a tariff deal.
The Prime Minister promised he would continue to protect children online but suggested he was open to changing the existing rules in order to reach an agreement with the White House.
The Trump administration is opposed to the UK’s digital services tax which is levied on large tech firms such as Mark Zuckerberg’s Meta, Jeff Bezos’s Amazon, and X, owned by the president’s ally Elon Musk.
US Vice President JD Vance, has accused Britain of stifling free speech with the Online Safety Act which creates a legal duty for social media firms to enforce their terms of service.
MPs on the Commons Liaison Committee asked Sir Keir Starmer whether the measures were part of his negotiations with the US, he replied: “In relation to trade talks, obviously there are questions about the appropriate way to tax digital services, etc. There are questions about how technology impacts free speech.
“I’ve been very clear in my view that we need to have arrangements for a digital tax of some sort, and equally we need to be pioneers of free speech which we have been for very many years in this country.
“But at the same time, we rightly protect under the Online Safety Act – further provisions of which are coming into force pretty quickly – and when it comes to pedophiles and protecting children, I take a pretty strong line that we take the necessary measures in order to do so.”
Neither the digital services tax nor the Online Safety Act is expected to be revoked entirely, however the Government is considering changing the way they work so that their impact on tech firms is softened, the i reports.
Starmer ruled out selling access to the NHS to American firms as part of the deal, telling the committee: “I have been very protective of the approach we take to the NHS in any dealings with any other country because it is our greatest asset, and we are not trading it away. That is the approach that I take here.”
Rachel Reeves confirmed that talks with the US involved a range of existing barriers to trade which could be removed or weakened as a quid pro quo for cutting tariffs.
She told the House of Commons: “We are discussing a range of different areas, but the focus is on reducing tariff and non-tariff barriers to trade, with a particular focus on those sectors that are subject to the higher tariffs.”
Trump singled out the car and steel industries for higher levies raising fears about their future in the UK.
Industry minister Sarah Jones promised to ‘stand up for UK steelmaking’ with financial support at a meeting of the Government’s steel council on Tuesday.
The state is expected to step in to save British Steel’s site in Scunthorpe as soon as this week, with full nationalisation one of the options.
Talks with the US on a closer economic partnership began when Starmer visited Trump at the White House back in February, but were not completed in time for the President’s ‘liberation day’ last week, when he slapped tariffs of at least 10 per cent on nearly all America’s trading partners, with some nations hit with much higher rates.
The Prime Minister told MPs: “Obviously we have to keep our options on the table and do the preparatory work for retaliation if necessary. But I think that trying to negotiate an arrangement which mitigates the tariffs is better.”
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