President Trump Ends Trade Negotiations with Canada Over Digital Services Tax
President Trump has terminated all trade discussions with Canada in response to the country's new digital services tax targeting U.S. tech companies.
President Donald Trump announced the immediate termination of all trade negotiations with Canada following the country's implementation of a 3% digital services tax on large technology firms. The tax, retroactive to January 1, 2022, primarily affects U.S.-based companies such as Alphabet, Meta Platforms, Amazon, and Uber Technologies.
In a statement on Truth Social, President Trump described the tax as "a direct and blatant attack on our Country," and indicated that the U.S. would inform Canada of new tariff rates within the next week.
The digital services tax applies to companies with global revenues exceeding €750 million and Canadian digital services revenues of at least CAD $20 million annually. This move mirrors similar legislation in the European Union, which has been a point of contention in U.S.-EU trade relations.
Canada is one of the United States' largest trading partners, and this development adds strain to the bilateral relationship. The Canadian government has yet to respond publicly to President Trump's announcement.
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