Trump Ends Canada Trade Talks Over Tech Tax
Trump, in a post on his social media network, announced that the United States was officially ending trade talks with Canada after being informed that the Canadian government would proceed with its plan to implement a digital services tax. According to Trump, Canada’s decision to move forward with taxing American technology companies was “unacceptable” and a “direct attack on American innovation and business.” He added that the U.S. had made multiple efforts to resolve the issue diplomatically but received no cooperation. The digital services tax, which targets large U.S.-based tech firms operating in Canada, has long been a point of contention between the two nations. Trump accused the Canadian government of acting in bad faith and using American businesses as “cash cows” to cover its domestic spending. The former president stated that the U.S. would now explore “retaliatory measures,” including tariffs and sanctions, in response to Canada’s move. Trump’s announcement marks a major blow to ongoing trade negotiations that were aimed at strengthening economic ties. The Canadian government has yet to respond officially to Trump’s statement.
Washington: Trump Halts Trade Talks With Canada Over Tech Tax Dispute
President Donald Trump on Friday announced that the United States is suspending all trade negotiations with Canada after Ottawa reaffirmed plans to move forward with a digital services tax. Calling it “a direct and blatant attack on our country,” Trump said the tax unfairly targets U.S.-based technology companies.
In a post on his social media network, Trump wrote that Canada had notified the U.S. it was going ahead with the tax, which will apply to both Canadian and foreign companies that generate revenue from online users in Canada. The tax, scheduled to take effect Monday, imposes a 3% levy on tech firms’ Canadian revenue, retroactively from 2022, leaving U.S. giants such as Amazon, Google, Meta, Uber, and Airbnb facing a combined \$2 billion bill.
would announce retaliatory tariffs within a week.
Canadian Prime Minister Mark Carney responded by reaffirming his government’s commitment to continuing negotiations. “It’s a negotiation,” Carney said.
Relations with Canada have been strained, with Trump repeatedly criticizing the northern neighbor and even joking it could become a U.S. state. Though the two leaders met in May at the White House and again at the G7 summit in Alberta, tensions persisted.
The U.S. is also considering fresh tariffs of up to 25% on Canadian and Mexican goods under national security grounds, including measures aimed at curbing fentanyl trafficking. Some exceptions still apply under the USMCA, signed during Trump’s first term, but escalating trade tensions now cast uncertainty over that agreement’s future.