A high-level U.S. government announcement signals that a deal to restructure TikTok’s U.S. operations could generate $50 billion in tax revenue over 10 years, according to senior officials. The move, backed by President Trump and Treasury Secretary Scott Bessent, marks a pivotal shift in digital regulation and trade policy.
- U.S. government anticipates $50 billion in tax revenue over 10 years from TikTok’s U.S. operations restructuring
- New ownership model requires U.S.-based entity to manage TikTok’s American data and infrastructure
- Proposed 15% digital services tax and 20% capital gains levy on equity appreciation
- GOOGL, META, APPL, and TSLA saw pre-market gains of 1.8% to 3.2% following announcement
- Deal reflects strategic convergence of national security, fiscal policy, and digital market control
- Valuation cap of $120 billion set for TikTok’s U.S. operations by 2035
Senior U.S. officials, including Treasury Secretary Scott Bessent and FBI Director Kash Patel, confirmed that a finalized agreement on TikTok’s U.S. operations could yield $50 billion in federal tax revenue over the next decade. The plan involves a structured ownership model where a U.S.-based entity—potentially led by a consortium of American tech firms—would take control of TikTok’s American user data and infrastructure, with the government receiving a share of future profits through a special tax regime. The proposed framework, reportedly under review by the White House and the Department of Justice, would require TikTok’s parent company, ByteDance, to divest its direct ownership stake in the U.S. platform. Under the new structure, the U.S.-based operator would be subject to a 15% digital services tax and a 20% capital gains levy on any profit from equity appreciation, assuming a valuation cap of $120 billion by 2035. This development has immediate implications for major tech stocks. Shares of GOOGL, META, APPL, and TSLA rose between 1.8% and 3.2% in pre-market trading, reflecting investor optimism that U.S. tech firms may benefit from increased digital infrastructure control. Analysts note that the deal could accelerate consolidation in the digital advertising sector, with potential for new partnerships between legacy platforms and emerging content creators. The announcement also intensifies scrutiny on U.S.-China technology relations. While the government maintains that national security concerns are central to the restructuring, the financial incentives suggest a dual motive: safeguarding data and maximizing public revenue. The move underscores a broader trend of regulatory intervention in digital markets, potentially influencing future policies on data sovereignty and platform accountability.