Trump Halts Trade Talks With Canada Over Proposed Tax on U.S. Tech Giants

President Donald Trump announced Friday that he is terminating all trade negotiations with Canada in response to the country’s digital services tax, which he claims unfairly targets major U.S. technology firms.

“Based on this egregious tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately,” Trump declared in a post on his Truth Social platform.

He further warned that Canada will “soon find out the levy it needs to pay to do business in the United States,” labeling America’s northern neighbor as “very difficult” to trade with.

The move comes amid rising tensions over Canada’s digital services tax, which was enacted last year. Washington previously raised concerns, initiating dispute settlement proceedings in 2023. The U.S. argues that the tax disproportionately affects American tech companies, with billions of dollars in payments reportedly due by June 30, according to the Computer & Communications Industry Association.

Although Canada has largely avoided some of Trump’s broader trade measures such as the 10 percent tariffs imposed in April on most foreign trade partners it remains subject to a separate set of duties. Since returning to the White House in January, Trump has reintroduced steep tariffs on imports of steel, aluminum, and automobiles.

In response, Canada announced last week it would revise its 25 percent counter-tariffs on U.S. steel and aluminum if no agreement is reached within 30 days. This follows the Biden-era decision, now reinforced by Trump, to double U.S. tariffs on those imports to 50 percent.

The breakdown in trade talks signals a significant deterioration in U.S.-Canada relations and raises uncertainty for businesses on both sides of the border.

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Source: NDTV

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