By Paul Wallis
June 28, 2025
DIGITAL JOURNAL
Photo by Jason Hafso on Unsplash
It’s anyone’s guess how a 3% tax on digital services turns out to be a deal breaker for all trade negotiations between the U.S. and Canada.
Trump has issued yet another tirade about “attacking our Country”. This is stock phraseology, and it’s getting ancient. It’s his usual one-way rhetoric with appalling capitalizations of words that don’t need capitalizing.
3% of anything is an attack on America? How? Canada is being nice about it, as usual. It should be 15%, the benchmark for this type of tax.
Just a few points:
This tax is peanuts. He’s blocking trade talks worth much more for a few bucks?
This tax is incurred in Canada only.
He can’t stop Canada from imposing a tax anyway.
Canadian tax has absolutely nothing to do with the U.S.
The tech media sector is famous for ducking tax and often paying no tax at all worldwide for decades.
It’s terrible trade policy.
It’s lousy foreign relations.
Trump’s “King of the World” approach never works anyway.
He insists on issuing edicts to other countries, and those countries don’t like it.
Whatever he demands doesn’t happen. It just uses up a lot of media space.
Far more questionable is one glaring fact. Big Tech has received a lot of quite unnecessary favors from Trump. One of those favors is in the “Big Beautiful Bill” aka ready-made budgetary catastrophe. Federal revenue will be totally trashed by this idiotic bill, and all U.S. government spending will be severely compromised.
For example – The bill prohibits U.S. states from regulating AI for 10 years. This is effectively giving Big Tech a blank check for a decade with no compliance issues.
Simultaneously, he’s complaining about other countries raising their own revenue while destroying his own revenue base.
Trump is also accusing Canada of “copying the EU,” which has been far less patient with Trump edicts since 2016. Trump’s entire first term had no real effect on the EU, for all the bluster.
That’s likely to be the pattern for the future. Other countries will adopt the same perspective. Trump’s constant attacks against Canada and other countries will backfire badly. From “annexation” to “51st state,” he’s guaranteed failure in any negotiation with Canada.
The rest of the world has more than a few problems with American overreach, too. China, Australia, Japan, India, the EU, and others don’t have to listen to this drivel.
The U.S. could progressively get bypassed as new trade agreements and much cheaper alternatives emerge. That could have very negative long-term consequences.
The good news is that Canada can ignore this babble for a while.
__________________________________________________
Disclaimer
The opinions expressed in this Op-Ed are those of the author. They do not purport to reflect the opinions or views of the Digital Journal or its members.
Photo by Jason Hafso on Unsplash
It’s anyone’s guess how a 3% tax on digital services turns out to be a deal breaker for all trade negotiations between the U.S. and Canada.
Trump has issued yet another tirade about “attacking our Country”. This is stock phraseology, and it’s getting ancient. It’s his usual one-way rhetoric with appalling capitalizations of words that don’t need capitalizing.
3% of anything is an attack on America? How? Canada is being nice about it, as usual. It should be 15%, the benchmark for this type of tax.
Just a few points:
This tax is peanuts. He’s blocking trade talks worth much more for a few bucks?
This tax is incurred in Canada only.
He can’t stop Canada from imposing a tax anyway.
Canadian tax has absolutely nothing to do with the U.S.
The tech media sector is famous for ducking tax and often paying no tax at all worldwide for decades.
It’s terrible trade policy.
It’s lousy foreign relations.
Trump’s “King of the World” approach never works anyway.
He insists on issuing edicts to other countries, and those countries don’t like it.
Whatever he demands doesn’t happen. It just uses up a lot of media space.
Far more questionable is one glaring fact. Big Tech has received a lot of quite unnecessary favors from Trump. One of those favors is in the “Big Beautiful Bill” aka ready-made budgetary catastrophe. Federal revenue will be totally trashed by this idiotic bill, and all U.S. government spending will be severely compromised.
For example – The bill prohibits U.S. states from regulating AI for 10 years. This is effectively giving Big Tech a blank check for a decade with no compliance issues.
Simultaneously, he’s complaining about other countries raising their own revenue while destroying his own revenue base.
Trump is also accusing Canada of “copying the EU,” which has been far less patient with Trump edicts since 2016. Trump’s entire first term had no real effect on the EU, for all the bluster.
That’s likely to be the pattern for the future. Other countries will adopt the same perspective. Trump’s constant attacks against Canada and other countries will backfire badly. From “annexation” to “51st state,” he’s guaranteed failure in any negotiation with Canada.
The rest of the world has more than a few problems with American overreach, too. China, Australia, Japan, India, the EU, and others don’t have to listen to this drivel.
The U.S. could progressively get bypassed as new trade agreements and much cheaper alternatives emerge. That could have very negative long-term consequences.
The good news is that Canada can ignore this babble for a while.
__________________________________________________
Disclaimer
The opinions expressed in this Op-Ed are those of the author. They do not purport to reflect the opinions or views of the Digital Journal or its members.
Trump Shoves Canada Out in the Cold in New Trade Freeze
\Trump says he’s ending trade talks with Canada over its 'egregious Tax' on technology firms
Farrah Tomazin
Fri, June 27, 2025
Donald Trump has reignited a fresh trade war with Canada after it imposed a digital service tax on American tech firms.
Less than two weeks after his G7 love-in with Prime Minister Mark Carney and other world leaders, Trump announced on Friday that he was immediately “terminating ALL discussions on Trade with Canada” and accused the country of a “blatant attack” on the U.S.
He added that he would announce new tariffs against Canada within the next week.
Canada's Prime Minister Mark Carney and U.S. President Donald Trump leave after a family photo session during the G7 Summit. / Suzanne Plunkett / REUTERS
“We have just been informed that Canada, a very difficult Country to TRADE with … has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country,” Trump said in a Truth Social post.
“They are obviously copying the European Union, which has done the same thing. 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. Thank you for your attention to this matter!”
The president’s declaration threatens America’s trade relationship with its northern ally and a key global trading partner.
But questions remain as to whether Trump will go through with the plan, given his tendency to backtrack on threats, which has earned him the nickname “TACO”: Trump Always Chickens Out.
In March, for example, after talking tough on trade, Trump granted a one-month exemption on new tariffs impacting goods from Mexico and Canada for U.S. automakers.
He also postponed 25% tariffs on many imports from Mexico and some imports from Canada for one month, and lowered the tariff rate on potash provided the goods were compliant with the United States-Mexico-Canada Agreement.
In May, Canadian Prime Minister Mark Carney met with Donald Trump at the White House to tell the president Canada
The Daily Beast has reached out to Carney’s office for a response to the latest salvo.
It comes after the Canadian Prime Minister privately courted Trump in the weeks leading up to the G7 summit, calling and texting Trump and his allies to ease past tensions between the two countries.
Those tensions ignited earlier this year, when Trump repeatedly called for Canada to become America’s 51st state.
“It’s not for sale,” a defiant Carney told Trump during an Oval Office meeting in May. “Won’t be for sale, ever.”
Canada’s Digital Services Tax imposes a 3% tax on large foreign and domestic digital companies that make over $20 million (Canadian dollars) in revenue.
While the president said he had just been informed of the tax, it received royal assent in Canada on June 20, to take effect on June 28.
Trump’s decision to suspend the trade talks has been criticized by some.
“This is pure stupidity,” said Nevada Democrat Congressman Steven Horsford.
Trump Cuts Off Trade Talks With Canada Over Digital Services Tax
Sean Burch
Fri, June 27, 2025
President Donald Trump on Friday said he was “terminating ALL discussions on Trade” with Canada over the country’s new digital services tax that aims to collect billions of dollars from American tech giants like Meta and Amazon, starting on Monday.
“We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country,” Trump posted on Truth Social.
The president then said he was canceling all trade discussions with America’s northern neighbor due to the “egregious Tax.”
He added “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,” before adding his trademark sign-off, “Thank you for your attention to this matter!”
Canada’s DST is a 3% tax on large tech companies with more than about $800 million in annual revenue. It targets companies involved in social media services and online advertising, which puts tech giants like Meta, the parent company of Facebook and Instagram, Amazon, and Google-parent Alphabet on the hook for payments.
The first tax payment is due on Monday, and is retroactive to sales made since the start of 2022. The Wall Street Journal estimated that initial payment would be around $3 billion for the collective U.S. firms being taxed.
Upon the president’s post on Friday, Canadian Prime Minister Mark Carney’s office shared a brief response.
“The Canadian government will continue to engage in these complex negotiations with the United States in the best interests of Canadian workers and businesses,” his office said.
The post Trump Cuts Off Trade Talks With Canada Over Digital Services Tax appeared first on TheWrap.
Trump says he is ending Canada trade talks amid tech tax dispute
Dominic Rushe in New York
THE GUARDIAN
Fri, June 27, 2025
Trump at the White House on Thursday.Photograph: Yuri Gripas/EPA
Donald Trump has announced he is ending trade talks with Canada, one of its largest trading partners, accusing it of imposing unfair taxes on US technology companies in a “direct and blatant attack on our country”.
The news came hours after the US had announced a breakthrough in talks with China over rare-earth shipments into America, and announcements from top officials that the US would continue trade negotiations beyond a 9 July deadline set by Trump.
Signs of a cooling in the trade war sent US stock markets to new highs.
The US has been negotiating a trade deal with Canada, one of its top two global trading partners, for months. Mark Carney, Canada’s prime minister, met Trump at the G7 summit of world leaders in Alberta earlier this month.
Carney announced that Trump had agreed to “pursue negotiations toward a deal within the coming 30 days”.
But talks appear to have foundered over Canada’s decision to impose a digital services tax on US technology companies. First payments on the tax are due on Monday and will cost US tech companies, including Alphabet, Amazon and Meta, an estimated $3bn.
Trump wrote on Truth Social: “We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country.
“They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also. 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.
“Thank you for your attention to this matter!’
Fri, June 27, 2025
Trump at the White House on Thursday.Photograph: Yuri Gripas/EPA
Donald Trump has announced he is ending trade talks with Canada, one of its largest trading partners, accusing it of imposing unfair taxes on US technology companies in a “direct and blatant attack on our country”.
The news came hours after the US had announced a breakthrough in talks with China over rare-earth shipments into America, and announcements from top officials that the US would continue trade negotiations beyond a 9 July deadline set by Trump.
Signs of a cooling in the trade war sent US stock markets to new highs.
The US has been negotiating a trade deal with Canada, one of its top two global trading partners, for months. Mark Carney, Canada’s prime minister, met Trump at the G7 summit of world leaders in Alberta earlier this month.
Carney announced that Trump had agreed to “pursue negotiations toward a deal within the coming 30 days”.
But talks appear to have foundered over Canada’s decision to impose a digital services tax on US technology companies. First payments on the tax are due on Monday and will cost US tech companies, including Alphabet, Amazon and Meta, an estimated $3bn.
Trump wrote on Truth Social: “We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country.
“They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also. 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.
“Thank you for your attention to this matter!’
Elisabeth Buchwald, CNN
Fri, June 27, 2025
Cargo containers are stacked at the Centerm container terminal, in Vancouver, Canada, on June 5. Trump said in a Truth Social post Friday he was terminating trade talks with America's northern neighbor. - Liang Sen/Xinhua/Getty Images
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President Donald Trump said Friday he has put an end to trade talks with Canada and will soon announce a new tariff rate for that country, he said in a Truth Social post on Friday.
The decision to end negotiations, which have been ongoing for several months, came after Canada announced a digital service tax, Trump said, calling it “a direct and blatant attack on our Country.”
“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,” he said.
Trump has taken particular issue with DSTs throughout trade negotiations with other countries, commonly referring to them as “non-tariff trade barriers.” Canada has a new DST that is set to take effect on Monday that will be retroactive to 2022.
Digital services taxes are a way for countries to tax online services, in contrast to taxes on physical products. Countries with these taxes can collect revenue from large companies that operate online — even if the business is unprofitable. American firms, especially Big Tech companies such as Meta, Apple, Google, Amazon and Microsoft, are disproportionately affected by DSTs, according to a report published last year by the nonpartisan Congressional Research Service.
Prime Minister Mark Carney said on Friday he wants to continue negotiating with the US.
“We’ll continue to conduct these complex negotiations in the best interest of Canadians. It’s a negotiation,” Carney said to reporters.
“We knew (the tax) was coming. We hoped they wouldn’t do it,” Treasury Secretary Scott Bessent said Friday on CNBC.
“We think it’s patently unfair to do it retroactive. This is something from the Trudeau years, so we were hoping, as a sign of goodwill, that the new Carney administration would at least put a break on that during the trade talks. They seem not to have,” Bessent added. If the Canadian government moves forward with the tax, Bessent said Trump is prepared to impose higher tariffs across all Canadian goods, without specifying a rate.
Canada is the top buyer of American goods, importing $349 billion worth last year, according to Department of Commerce data. Meanwhile, Canada shipped $413 billion worth of goods to the US last year, the third-highest source of foreign goods.
Levying higher tariffs on Canada would likely cause the country to retaliate by imposing higher tariffs on American goods. That would take a toll on both countries’ economies.
Prime Minister Mark Carney’s office told CNN the Canadian government is considering its response.
In a social media post, Pierre Poilievre, the leader of Canada’s Conservative Party, wrote that he hopes both countries can return to the negotiating table.
“Disappointed that trade talks have halted. Hopefully they resume quickly,” he wrote.
Several Canadian businesses and groups CNN has spoken to have been pushing the government not to move forward with the tax, fearing they could cause trade tensions to escalate between the US.
“For many years, the Business Council of Canada has warned that the implementation of a unilateral digital services tax could risk undermining Canada’s economic relationship with its most important trading partner, the United States,” Goldy Hyder, president and CEO of the Business Council of Canada, said in a statement to CNN on Friday. “That unfortunate development has now come to pass.”
“In an effort to get trade negotiations back on track, Canada should put forward an immediate proposal to eliminate the DST in exchange for an elimination of tariffs from the United States.”
The Canadian Chamber of Commerce echoed those sentiments.
“Our position on the Digital Services Tax has been consistent, but primarily for the reason that it’s self-defeating in nature. That said, it’s a pivotal time for Canada-U.S. relations,” Candace Laing, president and CEO of the Canadian Chamber of Commerce, said in a statement to CNN.
“The tone and tenor of talks has improved in recent months, and we hope to see progress continue. We respect that Team Canada is conducting these negotiations at the table, and we need to give them the space to navigate.”
At the start of his second term, Trump threatened to impose a 25% tariff across all Canadian exports, with rates going even higher for specific products.
However, as it stands, most Canadian goods have been exempt from those 25% tariffs, as long as they comply with the United States-Mexico-Canada Agreement he negotiated in his first term.
The biggest exceptions, with some fine print, are the 25% tariffs on all foreign cars, car parts, steel and aluminum. Trump later doubled the tariff on all steel and aluminum imports to 50%. Goods coming from Canada that were not USMCA-compliant have faced a combined 50% tariff rate.
In response to those auto tariffs, Canada levied a 25% tariff on US-made vehicles that aren’t compliant with USMCA. Canada also retaliated against Trump’s initial 25% steel and aluminum tariffs by rolling out a 25% tariff on roughly $43 billion worth of US goods, including whiskey, sporting gear and household appliances.
Dozens of other countries could soon face higher tariffs as a July 9 deadline looms for “reciprocal” tariffs announced in April to resume unless the impacted countries ink trade deals with the United States. It’s unclear if Trump will end up extending that deadline further and where tariff rates could end up. Several European Union countries also have DSTs, however, Bessent said on Friday, “We’re in active discussions with them to take those down.”
Stocks closed higher Friday despite Trump’s latest tariff threat. The S&P 500 and the tech-heavy Nasdaq, which had dipped into the red after his post, both gained 0.52% to close at record highs. The Dow gained 432 points, or 1%.
This story has been updated with additional context and developments.
CNN’s Paula Newton, Max Saltman, Matt Egan and John Towfighi contributed reporting.
Trump Says He’s Ending Canada Trade Talks Over Its 3% Digital Services and Streaming Tax: ‘Blatant Attack on Our Country’
Todd Spangler
Fri, June 27, 2025
President Trump announced Friday that the U.S. is cutting off trade talks with Canada, citing the country’s digital services tax, which is set to go into effect next week.
Canada’s 3% digital services tax has been in place since last year but the first payments are due from domestic and foreign companies beginning on Monday, June 30. The tax will require affected companies, predominantly big U.S. technology firms, to pay up to $3 billion to the Canadian government, including retroactive charges dating back to 2022, according to the Washington, D.C.-based Computer & Communications Industry Association trade group.
“We have just been informed that Canada, a very difficult Country to TRADE with… has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country,” Trump wrote Friday in a post on Truth Social. “They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also.”
Trump continued, “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. Thank you for your attention to this matter!”
Trump earlier this year imposed a 25% tariff on Canadian goods, and higher levies on certain specific categories of products — and his comment Friday suggested that he is looking at imposing an even higher tariff rate on the country. In 2024, U.S. goods exports to Canada were $349.4 billion, down 1.4% from the year prior, according to the office of the U.S. trade representative.
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