Labour MP and Ed Davey are concerned social media companies could be let off hook just as benefits are cut

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

His chancellor, Rachel Reeves, confirmed on Sunday that there are “ongoing” discussions about the UK’s £1bn-a-year digital services tax that affects companies from Meta to Amazon.