Canada’s Digital Tax Triggers Trump’s Fury

U.S. President Donald Trump announced the immediate termination of all trade negotiations with Canada in response to Canada’s new digital services tax, which imposes a 3 percent levy on revenues from large technology companies with significant Canadian user bases. Trump described the tax as a "direct and blatant attack" on the United States, declaring via social media that the U.S. would inform Canada within seven days of new tariffs it would face when doing business with the U.S. The digital services tax, passed in June 2024, targets major tech firms such as Amazon, Google, Meta, Uber, and Airbnb, and is set to be collected retroactively from 2022, with the first payments due imminently.

Canadian officials have so far resisted industry calls to delay the tax, which is expected to raise about $2 billion and applies to both foreign and domestic companies exceeding 20 million Canadian dollars in annual digital revenue from Canadian users. The abrupt end to negotiations follows recent efforts by Prime Minister Mark Carney and Trump to reach a broader trade agreement, and it raises the prospect of renewed trade tensions and economic uncertainty between the two countries. As of now, the Canadian government has not issued a public response to Trump’s announcement, and details regarding the specific U.S. tariffs are expected in the coming days.

Source: Al Jazeera