On Monday, US trade officials said that they had investigated the measure and found it was "unusually burdensome for affected US companies", according to a statement.
The plan was announced by the USA trade representative (USTR) on Monday at the conclusion of an investigation into the French digital services tax, which has pitted Donald Trump against Emmanuel Macron, the French president, for months.
France's 3% levy applies to revenue from digital services earned by firms with more than 25 million euros ($27.86 million) in French revenue and 750 million euros ($830 million) worldwide. He added the United States could investigate similar taxes by Austria, Italy and Turkey.
The French government says it's urgent to overhaul tax rules because the average tax rate for digital companies in the European Union is only 9.5%, compared with 23.2% for other companies.
Trump in August suggested tariffs of up to 100% on French wine and told aides that while he's not generally empathetic with US tech companies, he believes it should be the USA - not any other country - that taxes them, people familiar with internal deliberations said.
The last date to submit comments on the proposed actions is January 14, and "USTR expects to proceed expeditiously thereafter".
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The Monday release also included a reactive notice which threatened to target a number of French goods for tariffs, including handbags, porcelain, beauty products, cheeses, sparkling wine, soap and more items.
US Trade Representative Robert Lighthizer said the US government was also exploring whether to open similar investigations into the digital services taxes of Austria, Italy, and Turkey.
Industry groups welcomed the report, with the Information Technology and Innovation Foundation saying in a statement that France's tax is "narrowly and inappropriately targeted to raise revenue only from the largest companies in a small set of industries, many of them American".
"We respectfully urge the United States, France, and all participating governments to focus on a successful and lasting tax policy resolution" at the Organization for Economic Cooperation and Development (OECD), she said in a statement.
The U.S. move is a setback for efforts to stop a conflict over digital tax from intensifying. With talks between Washington and Paris not yielding much result, however, France's Senate gave the final approval for it last month. An official at the French Finance Ministry declined to comment and said Minister Bruno le Maire would speak on the matter Tuesday.
"Having demanded an worldwide solution from the OECD, it (Washington) now isn't sure it wants one", Le Maire told France Inter radio.