US cuts off trade talks with Canada

New York [US], June 28: US President Donald Trump announced an immediate end to trade talks with Canada in response to the country's digital services tax on technology companies.
In a post on the Truth Social platform on June 27, President Trump called Canada 's tariffs "a direct and blatant attack on our country."
"Based on these incredible tariffs, we are terminating all trade negotiations with Canada, effective immediately. Within the next 7 days, we will be informing Canada of the tariffs they will have to pay to do business with the United States," President Trump wrote, marking a clear escalation in pressure tactics.
According to Al-Jazeera, Canada passed the Digital Services Tax Act on June 20, 2024, and the law took effect immediately after on June 28. Accordingly, Canada will impose a 3% tax on revenue from digital services that a company collects from Canadian users, applicable to companies with revenue of over CAD 20 million (USD 14.6 million) in a year.
Businesses have called for a moratorium on the tax, saying it would increase the cost of providing services and risk antagonizing the U.S. government. But the federal government is sticking to its guns. The Canada Revenue Agency will begin collecting the tax early next week and will apply it retroactively starting in 2022.
Last week, Canadian Finance Minister Francois-Philippe Champagne suggested to reporters that a digital tax could be negotiated as part of ongoing trade talks between the U.S. and Canada, according to Bloomberg News. Those talks appeared to be progressing well, with expectations for a trade deal by July. However, the status of that agreement is now unclear.
Canadian Prime Minister Mark Carney's office issued a brief statement on the evening of June 27 saying: "The Government of Canada will continue to engage in these complex negotiations with the United States in the best interests of Canadian workers and businesses."
Canada is the United States' second-largest trading partner after Mexico, and last year it bought $349.4 billion in American goods and exported $412.7 billion to the United States, according to U.S. Census Bureau data. Canada has been hit by Trump's tariffs on steel, aluminum, and some auto parts and cars. The Canadian economy is already slowing, with unemployment hovering at 7%.
Source: Thanh Nien Newspaper