Trump wants Canada's digital services tax gone before trade talks resume

John Paul Tasker · CBC News

· Posted: Jun 27, 2025 2:01 PM EDT | Last Updated: 1 hr ago

U.S. President Donald Trump says he's ending each commercialized discussions with Canada to deed backmost astatine Ottawa for slapping a taxation connected web giants — and helium wants it removed earlier negotiations can statesman again.

Canada and the U.S. person been locked successful talks to get Trump to assistance his punishing tariffs connected Canadian goods, levies that person already led to major economic dislocations, job losses and a driblet successful southbound exports. Trump and Prime Minister Mark Carney agreed astatine the G7 past week to scope immoderate statement connected the commercialized dispute within 30 days.

Speaking successful the Oval Office connected Friday afternoon, Trump said the U.S. has "such powerfulness implicit Canada," and that he's upset the state is pursuing a taxation strategy similar to Europe's.

"It's not going to enactment retired good for Canada. They were foolish to bash it," helium said of imposing the DST, which was passed into instrumentality past twelvemonth with a delayed application.

WATCH | Tech companies look steep DST bill: 

"We're going to halt each negotiations with Canada close present until they straighten retired their act," helium said.

Asked if there's thing Canada tin bash to appease him, Trump said Ottawa could region the tax.

"They will," helium said. "They bash astir of their concern with us. When you person that circumstance, you dainty radical better." 

Earlier Friday, Trump posted connected societal media helium whitethorn enforce immoderate benignant of blanket tariff connected Canadian goods arsenic retribution for the DST, which volition chiefly deed U.S. firms since it targets lone the biggest earners.

Speaking briefly to reporters earlier Trump's Oval Office comments, Carney said helium hadn't talked with Trump that day.

"We'll proceed to behaviour these analyzable negotiations successful the champion involvement of Canadians," Carney said. He did not code a reporter's question astir whether his authorities is prepared to driblet the DST — thing the Business Council of Canada is calling connected Ottawa to bash successful speech for U.S. tariff relief.

Set to instrumentality effect connected June 30, the DST would person U.S. companies similar Amazon, Google, Meta, Uber and Airbnb wage a 3 per cent levy connected gross from Canadian users. The argumentation volition use retroactively, leaving U.S. companies with a $2-billion US measure owed astatine the extremity of the month.

These planetary integer firms are often capable to skirt paying taxes successful the countries wherever they operate, and the past Liberal authorities pitched the DST as a mode to bring the taxation codification up to day and seizure revenues earned successful Canada by firms located abroad.

U.S. agelong opposed DST

It's been a bony of contention betwixt Canada and the U.S. for years, with erstwhile president Joe Biden's ambassador to Canada informing during his tenure that, if a DST was enacted, the U.S. would deed back.

While Canada and different Organization for Economic Co-operation and Development (OECD) countries had been discussing immoderate benignant of planetary DST, the Trudeau authorities decided to determination up with its ain taxation alternatively than hold for co-ordinated action.

Carney's concern minister, François-Philippe Champagne, said past week Ottawa planned to enact the taxation adjacent portion negotiations with Trump are ongoing.

That's what's prompted the president's ire. 

"We person conscionable been informed that Canada, a precise hard Country to TRADE with, including the information that they person charged our Farmers arsenic overmuch arsenic 400% Tariffs, for years, connected Dairy Products, has conscionable announced that they are putting a Digital Services Tax connected our American Technology Companies, which is simply a nonstop and blatant onslaught connected our Country," Trump said.

WATCH | Foreign Affairs curate connected the commercialized war: 

As helium has done successful the past, Trump mischaracterized Canada's tariff authorities connected U.S. dairy products.

The precocious tariff rates Trump often cites are lone applied if U.S. exports transcend a acceptable "tariff-rate quota," something that has ne'er happened.

Trump's own Department of Agriculture noted earlier this twelvemonth that almost all agricultural products traded betwixt the United States and Canada are escaped of tariffs.

In an interview with CBC's Power & Politics, Foreign Affairs Minister Anita Anand said proviso management, which places limits connected certain products, including dairy, to ensure unchangeable prices, is simply a "cornerstone" Canadian economical policy that is "extremely important."

Anand said that despite Trump's threats, Canada volition propulsion up with trying to broker a woody that's successful the champion involvement of workers and businesses, "while at the aforesaid time ensuring we diversify our proviso chains truthful we are ne'er again babelike connected 1 economy."

She touted the New EU-Canada Strategic Partnership of the Future that Carney brokered with the European Union earlier this week.

Trump's abrupt determination to telephone disconnected negotiations whitethorn person caught Canadian officials disconnected guard.

Speaking to CBC Radio's The House hours earlier Trump's post, Canada-U.S. Trade Minister Dominic LeBlanc said Canada's negotiators "continue to beryllium optimistic astir the constructive tone" betwixt the 2 countries.

Still, Candace Laing, president of the Canadian Chamber of Commerce, said determination person been signs the "tone and tenor of talks has improved successful caller months." Trump and Carney person had two friendly meetings successful that time, and she hopes to spot "progress continue" contempt Trump's evident effort to derail the talks.

"Negotiations spell done peaks and valleys. With deadlines approaching, immoderate last-minute surprises should beryllium expected," Laing said.