US treasury Steve Mnuchin has threatened new tariffs on UK car makers in response to UK Digital tariffs after Chancellor Sajid Javid said he would not back down over the digital tax that will hit US firms Apple, Amazon and Facebook on trade in the UK.
During the World Economic Forum in Davos, Boris Johnson and Donald Trump will discuss the trade agreement regarding the tech tax.
After Britain leaves the EU at the end of the month, the UK government sees a new trade deal with the US as a high priority.
The new digital tax is aimed at firms that do a lot of business in the UK but because of the international set up of the business they do not pay much, if any, UK taxes compared to their size.
After the US threatened new levies on French exports of wine, cheese and handbags. France agreed to suspend their tech tax until the end of the year, this will allow time for a multilateral coordinated agreement on tax reform to be agreed.
The UK and several other EU countries want to limit the tech companies ability to avoid taxes and feel it should be based on where the digital activity comes from, and not where their head office is.