But scrapping the tax would create a hole in Chancellor Rachel Reeves’ spending plans, as it’s expected to raise £800 million this year.
“We are both committed to making sure tech companies pay a fair rate of tax in the U.K … but we understand the U.S. has cited, as it has to countries around the world, concerns about the specific structure,” said Reynolds.
In January Trump’s administration withdrew from an international effort to negotiate a tech tax deal under the auspices of the Paris-based OECD.
As for a broader trade deal between the U.S. and U.K., Reynolds was cautiously optimistic. “It’s challenging, there’s no way to avoid saying that,” he said. “Particularly, our view would have been that we would not have any tariff applied to the U.K … we’re continuing an incredibly intensive set of negotiations and we will know pretty soon what the outcome [will be].”