BBC reveals that the European Union is preparing to suspend approval of the tax agreement they made with the United States in response to Donald Trump’s threat of new tariffs over the Greenland dispute.
BBC news reports, citing sources close to the International Trade Committee, that the European Parliament is planning to suspend approval of the tax agreement with the US agreed upon last July. The suspension is expected to be announced in Strasbourg, France, this Wednesday.
If this move occurs, it will escalate tensions once again between the US and Europe, as Donald Trump intensifies efforts to purchase Greenland and threatens new import tariffs on European countries opposing his plan over the past weekend.
These tensions have disrupted financial markets and revived talk of a trade war, including the possibility of retaliatory measures against the US for such trade policies.
Both US and European stock markets declined on Tuesday, with European markets facing a second consecutive day of losses, while the three major US stock indexes fell over 1% in early trading.
In the currency markets, the US dollar also dropped sharply. The euro strengthened by 0.8% against the dollar to 1.1742 USD, while the British pound rose 0.2% to 1.346 USD.
The EU-US tax agreement was reached after Donald Trump announced tariffs on imports from trading partners worldwide in April 2025. The deal lowered US import tariffs from 30% to 15%, in exchange for European investments in the US and adjustments to stimulate US exports.
However, the agreement still requires approval from the European Parliament to take effect officially.
Just hours after Trump threatened new tariffs over the Greenland dispute last Saturday, influential German MEP Manfred Weber stated, “Approval (of the agreement) cannot happen at this time.”
Previously, the EU had suspended plans to retaliate against US tariffs targeting American goods valued at over 93 billion euros while negotiations were ongoing between the two sides.
This suspension of retaliatory measures will end on 6 February, meaning the EU’s tariff measures will take effect on 7 February unless the bloc decides to extend the suspension or approve a new agreement.
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Source:bbc