The US president says "Numerous European countries" have been discussing bringing in such a levy.
The threat comes a day after the European Union approved tariff reductions on U.S. goods.
United States President Donald Trump has vowed to hit countries with a 100 per cent tariff should they impose a digital services tax (DST) on American companies.
The president claimed the tariffs would override a trade deal with the European Union, which European officials finalized just days ago.
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