Starmer is warned against 'appeasing' Trump on tax

Opposition and Labour MPs hit out over talk of digital deal to halt tariffs

- Rowena Mason

Keir Starmer has been warned against "appeasing" Donald Trump as he considers reducing a major tax for US tech giants while cutting disability benefits and public sector jobs.

His chancellor, Rachel Reeves, confirmed yesterday that discussions about the UK's £1bn-a-year digital services tax affecting companies from Meta to Amazon were "ongoing".

She expressed optimism that Trump's 25% tariffs on British steel could be removed in any deal but did not deny that changes could be made to the digital services tax the United States had lobbied against. "You've got to get the balance right," she said in an interview for the BBC's Sunday with Laura Kuenssberg programme.

While any changes would not take place in this week's spring statement, the Liberal Democrats warned Labour was "in danger of losing its moral compass" and it would be "tantamount to robbing disabled people to appease [Elon] Musk and Trump".

Labour MPs are already on the brink of rebellion over £5bn of cuts to disability benefits while trade unions are concerned about the £2bn of Whitehall cuts leading to about 10,000 civil service job losses and increasing the risk of wider redundancies in arm's-length bodies and local government.