USA Trump Halts Trade Talks with Canada Over Digital Tax, Threatens New Tariffs

[Social Media]

 

Trump Halts Trade Talks with Canada Over Digital Tax, Threatens New Tariffs

 

President Donald Trump has abruptly ended all ongoing trade negotiations with Canada, lashing out at the country’s newly implemented digital services tax, which he labeled “egregious” and “a direct and blatant attack on our Country.” The decision was announced via Trump’s Truth Social platform and sent shockwaves through global markets and diplomatic circles.

 

The U.S. president accused Canada of mimicking the European Union in targeting American tech companies, stating, “They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also.” The tax, which was passed by the Canadian government last year and is set to be collected starting Monday, applies retroactively to 2022 and targets major U.S. firms such as Amazon, Google, Microsoft, and Meta.

 

“Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately,” Trump declared. “We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period. Thank you for your attention to this matter!”

 

The Canadian government, led by Prime Minister Mark Carney, has acknowledged the U.S. announcement but has yet to issue a formal response. Carney’s office told CNN that officials are currently reviewing the situation. The fallout is expected to be significant, as Canada remains one of America’s most crucial economic partners, with two-way goods trade totaling $762 billion last year.

 

The timing of Trump’s decision is particularly dramatic, as both nations had been working toward finalizing a renewed trade agreement by mid-July. That effort followed a tit-for-tat tariff exchange earlier in the year, sparked by disputes over dairy and other agricultural products. Trump reiterated his long-standing frustrations on this front, calling Canada “a very difficult country” to do business with and referencing tariffs on American dairy exports.

 

The markets reacted swiftly and negatively to the news. The S&P 500 and Nasdaq, which had both touched record highs earlier in the day, plummeted following Trump’s statement. The uncertainty surrounding potential U.S. tariffs on Canadian goods has rattled investors already concerned about global trade tensions.

 

Canadian officials have consistently defended the digital services tax, arguing that multinational tech giants should pay their fair share for revenue earned within Canada. Earlier this month, they reaffirmed that the tax would not be withdrawn, even under mounting pressure from Washington. The tax has become politically sensitive, especially after Trump’s previous inflammatory suggestion that the U.S. might annex Canada and make it America’s 51st state—an outlandish claim that outraged Canadians and played a role in Mark Carney’s rise to power.

 

Trump’s abrupt move marks a major disruption in one of the world’s most integrated trade relationships. As Canadian firms prepare for a potential wave of tariffs, and American tech giants brace for millions in retroactive tax bills, the coming days may determine whether this rift deepens or a new diplomatic channel opens to prevent further escalation.

 

  Adapted by ASEAN Now from The Times  2025-06-30

 

 

[stevenl]

5 hours ago, Social Media said:

targets major U.S. firms such as Amazon, Google, Microsoft, and Meta.

It targets all tech firms that are avoiding taxes. It's not specifically aimed at US firms, although of course they are both the biggest firms and the biggest offenders.

[stevenl]

Apparently Canada has given in and rescinded the tech tax. IMO a pity, they should have stuck to the principle and negotiated this together with the EU.
Trade talks will resume again now.

[Eric Loh]

2 hours ago, stevenl said:

Apparently Canada has given in and rescinded the tech tax. IMO a pity, they should have stuck to the principle and negotiated this together with the EU.
Trade talks will resume again now.

He is strategizing not giving in. Carney is playing 3 dimensional chess with lightweight Trump. Carney has a phd in economics, governor of Bank of Canada and Bank of England and IMF adviser. Facing him is Trump with a phony degree whose bark is worse than his bite. Carney has now pressed Trump to a corner and pressed him to make a move. Meanwhile Canada is tying up trade agreements with EU and Asia away from their traditional trading partner USA. A lot of losing Dumpo. 

 

[Scottie12]

This man is just a bully and doesn't realise how he's damaging the reputation of the USA,it's all about hm.

[blazes]

Trump is dead right about the Canadian dairy tariffs, which are exclusively the fault of Quebec farmers.  Over many decades, governments of both sides have been too fearful of losing votes in Quebec.  Both major parties need Quebec votes to gain and keep power.  

As a result, Canadians as a whole pay vastly inflated prices for their dairy products.  It would be great for Canadians if Trump would target that tariff in particular (it comes to about 300%).

 

[spidermike007]

Just another area where a man possessing a spectacular level of ignorance has no understanding of the fact that Canadian lumber is far superior to American lumber, as the Boreal forests produce an incredibly dense type of lumber, from slow growing trees, that's desired by everyone in the construction trade. So as a result of this nonsense, all that incredible lumber is going to likely end up going to China.

 

Thanks Don you're really quite a winner in the stupidity department. 

[blazes]

3 minutes ago, Scottie12 said:

This man is just a bully and doesn't realise how he's damaging the reputation of the USA,it's all about hm.

Who cares about "reputation"?  You can't eat it or sell it.

And tariffs help the cause of "America first."  Other countries, especially Canada, have lots of scope to retaliate and move for more even-handedness in trade deals.

[blazes]

3 minutes ago, spidermike007 said:

Just another area where a man possessing a spectacular level of ignorance has no understanding of the fact that Canadian lumber is far superior to American lumber, as the Boreal forests produce an incredibly dense type of lumber, from slow growing trees, that's desired by everyone in the construction trade. So as a result of this nonsense, all that incredible lumber is going to likely end up going to China.

 

Thanks Don you're really quite a winner in the stupidity department. 

What so few seem to realise is that Canada has been selling its lumber for many decades to Japan and China (and of course the US).  

Many progressives in Canada have lamented the fact that Canada is just content to export raw logs, without developing secondary industry connected to the lumber (as is the case in Sweden, which encouraged the growth of IKEA into the world-class company it is today).

[angryguy]

9 hours ago, Social Media said:

We will let Canada know the Tariff that they will be paying to do business with the United States of America

RIP. What was carney thinking

[JonnyF]

Canada deserves huge tarriffs simply for electing Carney.

 

If I was Trump I'd stop negotiations now and hammer them with massive tarriffs. 

[blazes]

4 hours ago, stevenl said:

Apparently Canada has given in and rescinded the tech tax. IMO a pity, they should have stuck to the principle and negotiated this together with the EU.
Trade talks will resume again now.

 

Where did you get this  fake  news from???

[Purdey]

I suppose that countries could lower their trade with America and trade together a lot more. Is that out of the question?

[Jonnapat]

Carney is way too clever for you, orange buffoon.

[mikebike]

3 hours ago, blazes said:

Trump is dead right about the Canadian dairy tariffs, which are exclusively the fault of Quebec farmers.  Over many decades, governments of both sides have been too fearful of losing votes in Quebec.  Both major parties need Quebec votes to gain and keep power.  

As a result, Canadians as a whole pay vastly inflated prices for their dairy products.  It would be great for Canadians if Trump would target that tariff in particular (it comes to about 300%).

 

Really? You are worried about a tariff which doesn't even kick-in until the mutually agreed upon TARIFF FREE USA dairy import is reached? A point which the USA dairy industry has NEVER reached? Please elaborate on this egregious diary tariff that is causing you so much stress and innumerable dairy payments... 5555

[Srikcir]

1 hour ago, blazes said:

 

Where did you get this  fake  news from???

"Canada rescinds Digital Services Tax after Trump cuts off U.S. trade talks", Jun 29 2025

https://www.cnbc.com/2025/06/30/canada-rescinds-digital-services-tax-after-trump-cuts-off-us-trade-talks.html

I wouldn't call that Canada has "given in" but to allow TACO to give Canada a great trade deal. 

If Trump doesn't likely because he'll demand to high a price that threatens Canada's sovereignty, the tax can easily be reactivated.

[Nid_Noi]

15 minutes ago, Jonnapat said:

Carney is way too clever for you, orange buffoon.

Carney is an idiot who has no negotiation skills, a loser from the start. Since being installed as PM (not elected) he has achieved nothing. He won’t last very long.

He has just “recycled” the same losers as ministers. None of them have any competency.

[angryguy]

58 minutes ago, Purdey said:

I suppose that countries could lower their trade with America and trade together a lot more. Is that out of the question?

Sounds like you havent got a clue how the world is

[Srikcir]

13 hours ago, Social Media said:

Based on this egregious Tax

It is only egregious to Trump's Billionaire donors who own the billion dollar social media platforms who collect revenues from its subscribers but pay little or no income taxes to the nations those subscribers are resident. 

It is possible that Trump pays more income tax to China.