CARNEY CHICKENS OUT
Caving to Trump, Canada Drops Tax on US Tech Firms
One journalist accused Canadian Prime Minister Mark Carney of chickening out.
Canadian Prime Minister Mark Carney (left) and U.S. President Donald Trump depart following a group photo in front of the Canadian Rockies at the Kananaskis Country Golf Course during the G7 Leaders' Summit on June 16, 2025 in Kananaskis, Alberta.
(Photo: Suzanne Plunkett-Pool/Getty Images)
Canada cancels tax on US tech firms in hopes of Trump trade dealOne journalist accused Canadian Prime Minister Mark Carney of chickening out.
Canadian Prime Minister Mark Carney (left) and U.S. President Donald Trump depart following a group photo in front of the Canadian Rockies at the Kananaskis Country Golf Course during the G7 Leaders' Summit on June 16, 2025 in Kananaskis, Alberta.
(Photo: Suzanne Plunkett-Pool/Getty Images)
Eloise Goldsmith
Jun 30, 2025
COMMON DREAMS
Acquiescing to pressure from the Trump administration, the Canadian government announced on Sunday that the country will rescind the digital services tax, a levy that would have seen large American tech firms pay billions of dollars to Canada over the next few years.
The Sunday announcement from the Canadian government cited "anticipation of a mutually beneficial comprehensive trade arrangement" as the reason for the rescission.
"Today's announcement will support a resumption of negotiations toward the July 21, 2025, timeline set out at this month's G7 Leaders' Summit in Kananaskis," said Canadian Prime Minister Mark Carney in the statement.
The digital services tax impacts companies that make over $20 million in revenue from Canadian users and customers through digital services like online advertising and shopping. Companies like Uber and Google would have paid a 3% levy on the money they made from Canadian sources, according to CBC News.
The reversal comes after U.S. President Donald Trump on Friday blasted the digital services tax, calling it a "direct and blatant attack on our country" on Truth Social.
Trump said he was suspending trade talks between the two countries because of the tax. "Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. 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," Trump wrote. The United States is Canada's largest trading partner.
Payments from tech firms subject to the digital services tax were due starting on Monday, though the tax has been in effect since last year.
"The June 30, 2025 collection will be halted," and Canada's Minister of Finance "will soon bring forward legislation to rescind the Digital Services Tax Act," according to the Sunday statement.
"If Mark Carney folds in response to this pressure from Trump on the digital services tax, he proves he can be pushed around," said Canadian journalist Paris Marx on Bluesky, speaking prior to the announcement of the rescission. "The tax must be enforced," he added.
"Carney chickens out too," wrote the author Doug Henwood on Twitter on Monday.
In an opinion piece originally published in Canadian Dimension before the announcement on Sunday, Jared Walker, executive director of the progressive advocacy group Canadians for Tax Fairness, wrote that all the money generated for the tax could mean "more federal money for housing, transit, and healthcare transfers—all from some of the largest and most under-taxed companies in the world."
Walker also wrote that the digital service tax could serve as a counterweight to the so-called "revenge tax" provision in Trump's sprawling domestic tax and spending bill.
Section 899, called "Enforcement of Remedies Against Unfair Foreign Taxes," would "increase withholding taxes for non-resident individuals and companies from countries that the U.S. believes have imposed discriminatory or unfair taxes," according to CBC. The digital services tax is one of the taxes the Trump administration believes is discriminatory.
"If 'elbows up' is going to be more than just a slogan, Canada can't cave to pressure when Donald Trump throws his weight around," wrote Walker, invoking the Canadian rallying cry in the face of American antagonism when it comes to trade.
"But this slogan also means the Carney government has to make sure it is working on behalf of everyday Canadians—not just the ultra-rich and big corporations that are only 'Canadian' when it's convenient," Walker wrote.
Jun 30, 2025
COMMON DREAMS
Acquiescing to pressure from the Trump administration, the Canadian government announced on Sunday that the country will rescind the digital services tax, a levy that would have seen large American tech firms pay billions of dollars to Canada over the next few years.
The Sunday announcement from the Canadian government cited "anticipation of a mutually beneficial comprehensive trade arrangement" as the reason for the rescission.
"Today's announcement will support a resumption of negotiations toward the July 21, 2025, timeline set out at this month's G7 Leaders' Summit in Kananaskis," said Canadian Prime Minister Mark Carney in the statement.
The digital services tax impacts companies that make over $20 million in revenue from Canadian users and customers through digital services like online advertising and shopping. Companies like Uber and Google would have paid a 3% levy on the money they made from Canadian sources, according to CBC News.
The reversal comes after U.S. President Donald Trump on Friday blasted the digital services tax, calling it a "direct and blatant attack on our country" on Truth Social.
Trump said he was suspending trade talks between the two countries because of the tax. "Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. 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," Trump wrote. The United States is Canada's largest trading partner.
Payments from tech firms subject to the digital services tax were due starting on Monday, though the tax has been in effect since last year.
"The June 30, 2025 collection will be halted," and Canada's Minister of Finance "will soon bring forward legislation to rescind the Digital Services Tax Act," according to the Sunday statement.
"If Mark Carney folds in response to this pressure from Trump on the digital services tax, he proves he can be pushed around," said Canadian journalist Paris Marx on Bluesky, speaking prior to the announcement of the rescission. "The tax must be enforced," he added.
"Carney chickens out too," wrote the author Doug Henwood on Twitter on Monday.
In an opinion piece originally published in Canadian Dimension before the announcement on Sunday, Jared Walker, executive director of the progressive advocacy group Canadians for Tax Fairness, wrote that all the money generated for the tax could mean "more federal money for housing, transit, and healthcare transfers—all from some of the largest and most under-taxed companies in the world."
Walker also wrote that the digital service tax could serve as a counterweight to the so-called "revenge tax" provision in Trump's sprawling domestic tax and spending bill.
Section 899, called "Enforcement of Remedies Against Unfair Foreign Taxes," would "increase withholding taxes for non-resident individuals and companies from countries that the U.S. believes have imposed discriminatory or unfair taxes," according to CBC. The digital services tax is one of the taxes the Trump administration believes is discriminatory.
"If 'elbows up' is going to be more than just a slogan, Canada can't cave to pressure when Donald Trump throws his weight around," wrote Walker, invoking the Canadian rallying cry in the face of American antagonism when it comes to trade.
"But this slogan also means the Carney government has to make sure it is working on behalf of everyday Canadians—not just the ultra-rich and big corporations that are only 'Canadian' when it's convenient," Walker wrote.
Canadian Prime Minister Carney says trade talks with US resume after Canada rescinded tech tax
Copyright Sean Kilpatrick/AP
By Euronews with AP
Published on
Canada and Mexico face separate tariffs of as much as 25% that Trump put into place under the auspices of stopping fentanyl smuggling.
Trade talks between the US and Canada resumed after Ottawa rescinded its plan to tax US technology firms, Canadian Prime Minister Mark Carney said on Sunday
The news follows an announcement by US President Donald Trump on Friday, where he said he was suspending trade talks with his country’s northern neighbour over its plan to continue with its tax on technology firms.
Trump described this tax as a “direct and blatant attack on our country” which was set to go into effect on Monday.
Both the American and Canadian leaders reportedly spoke on the phone on Sunday, and Carney’s office said they agreed to resume negotiations. The Canadian government said “in anticipation” of a trade deal “Canada would rescind” the deal.
“Today’s announcement will support a resumption of negotiations toward the July 21, 2025, timeline set out at this month’s G7 Leaders’ Summit in Kananaskis,” Carney said in a statement.
Trump recently travelled to Canada for a G7 summit in Alberta, where Carney said both countries had set a 30-day-deadline for trade talks.
Canada’s Digital Services Tax was due to his companies like Amazon, Google and Meta with a 3% levy on revenue from Canadian users. It would have applied retroactively, leaving US companies with a $2 billion (€1,71 billion) US bill due at the end of the month.
Trump’s announcement on Friday was the latest in the trade war he’s launched since taking office for a second term in January. Progress with Canada has been a roller coaster, with Trump repeatedly suggesting it should be absorbed as a US state.
Canada on Sunday announced that it cancelled a tax targeting US tech companies such as Amazon, ahead of resuming trade negotiations with the US. Talks between the countries stalled after Canada introduced the Digital Services Tax in response to steep tariffs set to be imposed by the US.
Issued on: 30/06/2025 -
By: FRANCE 24
Canadian Prime Minister Mark Carney and US President Donald Trump at a G7 summit in Canada in June 2025. © Brendan Smialowski, AFP
Canada will rescind taxes impacting US tech firms that had prompted President Donald Trump to retaliate by calling off trade talks, Ottawa said Sunday, adding that negotiations with Washington would resume.
The digital services tax, enacted last year, would have seen US service providers such as Alphabet and Amazon on the hook for a multi-billion-dollar payment in Canada by Monday, analysts have said.
Washington has previously requested dispute settlement talks over the tax -- but on Friday Trump, who has weaponized US financial power in the form of tariffs, said he was ending trade talks with Ottawa in retaliation for the levy.
He also warned that Canada would learn its new tariff rate within the week.
But on Sunday, Ottawa binned the tax, which had been forecast to bring in Can$5.9 billion (US$4.2 billion) over five years.
Finance Minister Francois-Philippe Champagne "announced today that Canada would rescind the Digital Services Tax (DST) in anticipation of a mutually beneficial comprehensive trade arrangement with the United States," a government statement said.
It added that Trump and Canadian Prime Minister Mark Carney "have agreed that parties will resume negotiations with a view towards agreeing on a deal by July 21, 2025."
There was no immediate comment from the White House or Trump.
US Treasury Secretary Scott Bessent told CNBC on Friday that Washington had hoped Carney's government would halt the tax "as a sign of goodwill."
Canada has been spared some of the sweeping duties Trump has imposed on other countries, but it faces a separate tariff regime.
Since returning to the White House in January, Trump has also imposed steep levies on imports of steel, aluminum and autos.
Canada is the largest supplier of foreign steel and aluminum to the United States.
Last week, Carney said Ottawa will adjust its 25 percent counter tariffs on US steel and aluminum -- in response to a doubling of US levies on the metals to 50 percent -- if a bilateral trade deal was not reached in 30 days.
"We will continue to conduct these complex negotiations in the best interest of Canadians," Carney said Friday.
He had previously said a good outcome in the talks would be to "stabilize the trading relationship with the United States" and "ready access to US markets for Canadian companies" while "not having our hands tied in terms of our dealings with the rest of the world."
Carney and Trump met on the sidelines of the Group of Seven summit in Canada earlier this month. Leaders at the summit pushed Trump to back away from his punishing trade war.
Dozens of countries face a July 9 deadline for steeper US duties to kick in -- rising from a current 10 percent.
It remains to be seen if they will successfully reach agreements before the deadline.
Bessent has said Washington could wrap up its agenda for trade deals by September, indicating more agreements could be concluded, although talks were likely to extend past July.
(FRANCE 24 with AFP)
Canada will rescind taxes impacting US tech firms that had prompted President Donald Trump to retaliate by calling off trade talks, Ottawa said Sunday, adding that negotiations with Washington would resume.
The digital services tax, enacted last year, would have seen US service providers such as Alphabet and Amazon on the hook for a multi-billion-dollar payment in Canada by Monday, analysts have said.
Washington has previously requested dispute settlement talks over the tax -- but on Friday Trump, who has weaponized US financial power in the form of tariffs, said he was ending trade talks with Ottawa in retaliation for the levy.
He also warned that Canada would learn its new tariff rate within the week.
But on Sunday, Ottawa binned the tax, which had been forecast to bring in Can$5.9 billion (US$4.2 billion) over five years.
Finance Minister Francois-Philippe Champagne "announced today that Canada would rescind the Digital Services Tax (DST) in anticipation of a mutually beneficial comprehensive trade arrangement with the United States," a government statement said.
It added that Trump and Canadian Prime Minister Mark Carney "have agreed that parties will resume negotiations with a view towards agreeing on a deal by July 21, 2025."
There was no immediate comment from the White House or Trump.
US Treasury Secretary Scott Bessent told CNBC on Friday that Washington had hoped Carney's government would halt the tax "as a sign of goodwill."
Canada has been spared some of the sweeping duties Trump has imposed on other countries, but it faces a separate tariff regime.
Since returning to the White House in January, Trump has also imposed steep levies on imports of steel, aluminum and autos.
Canada is the largest supplier of foreign steel and aluminum to the United States.
Last week, Carney said Ottawa will adjust its 25 percent counter tariffs on US steel and aluminum -- in response to a doubling of US levies on the metals to 50 percent -- if a bilateral trade deal was not reached in 30 days.
"We will continue to conduct these complex negotiations in the best interest of Canadians," Carney said Friday.
He had previously said a good outcome in the talks would be to "stabilize the trading relationship with the United States" and "ready access to US markets for Canadian companies" while "not having our hands tied in terms of our dealings with the rest of the world."
Carney and Trump met on the sidelines of the Group of Seven summit in Canada earlier this month. Leaders at the summit pushed Trump to back away from his punishing trade war.
Dozens of countries face a July 9 deadline for steeper US duties to kick in -- rising from a current 10 percent.
It remains to be seen if they will successfully reach agreements before the deadline.
Bessent has said Washington could wrap up its agenda for trade deals by September, indicating more agreements could be concluded, although talks were likely to extend past July.
(FRANCE 24 with AFP)
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