The EU extends an "olive branch" to the Trump administration by abandoning the plan to impose a digital tax.

According to Politico, the European Commission has abandoned its plans for taxing digital enterprises, marking a significant victory for U.S. President Trump and American tech giants like Apple(AAPL.O) and Meta Platforms(META.O). Documents show that as U.S.-European trade negotiations enter the final sprint, Brussels has removed the digital tax option from its seven-year fiscal plan set to launch in 2028. Senior EU officials are engaged in crucial negotiations regarding the budget plan, with only a few days left until the budget proposal is released. This policy shift is a major turnaround for the EU—back in May, the budget documents discussed by the EU's 27 commissioners included a proposal to repay EU debts through taxes on tech giants. This sudden change may be a strategic move by the EU, which is eager to secure favorable trade terms with the U.S. Trump had previously threatened to impose retaliatory tariffs on Canada in response to its digital tax policy.