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17h ago

Canada Drops Digital Services Tax as U.S.-Canada Trade Talks Resume

The withdrawal opens negotiations aimed at clinching a deal by the July 21 deadline.

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Canadian Prime Minister Mark Carney and Trump will start the trade talks again to try and make a deal by July 21, 2025, the ministry said.

Overview

  • Canada’s finance ministry announced it has repealed the Digital Services Tax, a 3% levy on digital services revenue above CAD 20 million that was set to take effect Monday.
  • President Trump suspended trade negotiations on June 26, condemning the tax as a “direct and blatant attack” on American tech companies.
  • White House economic adviser Kevin Hassett said discussions would restart immediately, with both leaders targeting a comprehensive agreement by July 21, 2025.
  • The agreement follows a G7 summit commitment in Kananaskis for a 30-day timeline to negotiate a new economic and security relationship.
  • Since April, the administration has used sweeping tariffs as leverage to secure concessions on defense spending, technology regulation and other issues.