Keir Starmer faces warnings against “appeasing” Donald Trump as he considers reducing a major tax for US tech companies while simultaneously cutting disability benefits and public sector jobs. His Chancellor, Rachel Reeves, has confirmed that discussions are ongoing about the UK’s £1bn-a-year digital services tax, which affects companies like Meta to Amazon. Reeves expressed optimism that Trump’s 25% tariffs on British steel could be removed in any deal and did not deny possible changes to the digital services tax, which the US has lobbied against. Lib Dems have accused Labour of losing its moral compass and warned that tax relief for tech companies could come at the expense of disabled people. The tax cuts for big US tech companies, alongside austerity for vulnerable populations, have been labeled as “extractive politics” by Clive Lewis, a former Labour shadow cabinet minister. The Liberal Democrats, led by Ed Davey, faced opposition to the proposal, suggesting that appeasement tactics would not work with Trump. Meanwhile, Starmer has stated that he “likes and respects” Trump, signaling a different approach to transatlantic relations during this critical moment for the UK.

Source: https://www.theguardian.com/politics/2025/mar/23/starmer-is-warned-against-appeasing-trump-with-tax-cut-for-us-tech-firms