The One Big Beautiful Bill Act (OBBBA) was passed by the U.S. House of Representatives on May 22, 2025, by a narrow vote of 215-214. OBBBA includes a new U.S. tax provision that could significantly increase taxes on foreign companies and investors—especially those from countries like France that have implemented digital services taxes or other similar measures. The new bill introduces a new section to the U.S. Internal Revenue Code Section 899.

 What Is Section 899?

Section 899 is a proposed tax provision that would raise U.S. tax rates on foreign individuals and companies from countries the U.S. deems to have “unfair” tax policies. These include:

 How Would the Tax Work?

Who Is Affected?

Countries likely to be labeled as “discriminatory” include France, Germany, the UK, Japan, South Korea, and others that have adopted DSTs or UTPRs. In total, more than 30 countries could be impacted.

DST in France

France currently has a Digital Services Tax (DST) in place that applies to major U.S. technology companies and other large digital firms. Introduced in 2019, the French DST targets revenues generated from digital services such as:

Despite international negotiations aimed at replacing such taxes with a global framework (like the OECD’s Pillar One), France has maintained its DST. As of 2025, French Finance Minister Éric Lombard confirmed that the tax remains in force and is not being used as a bargaining chip in trade discussions with the U.S.

This continued application of the DST is one of the key reasons France could be classified as a “discriminatory foreign country” under the proposed U.S. Section 899, potentially subjecting French companies to higher U.S. tax rates.

 Why Is the U.S. Doing This?

The U.S. government argues that certain foreign tax policies unfairly target American companies—especially tech giants. Section 899 is designed to:

 Economic Impact

According to estimates, this provision could generate $116 billion in revenue over 10 years. Legal experts describe it as a major shift in U.S. international tax policy, introducing new risks for foreign investors.

 When Would It Take Effect?

Although passed by the U.S. Congress, OBBBA is now being reviewed and must be passed by the U.S. Senate and then signed by President Trump to become law. Unless the Senate passes OBBBA as drafted, any amendments of the bill would have to be returned to the House for approval of the changes, or a conference committee of both chambers formed to reconcile differences.

The additional taxes would apply 180 days after a country enacts a DST, DPT, or UTPR.

What Should French Companies Do?

If your business operates in the U.S. or has American subsidiaries, now is the time to:

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