Canada and the United States take up their trade talks again. Both sides announced that. The Canadian Prime Minister Mark Carney said, according to the Ministry of Finance on Sunday evening (local time), that his country had withdrawn his plan to tax US technology companies, in anticipation of “a comprehensive trade agreement”. The tax should come into force this Monday. The United States is by far the most important trading partner for Canada.
US President Donald Trump, Kevin Hassett, confirmed the new turn in trade relationships on Monday in the Fox News broadcaster. When asked whether the United States will immediately resume negotiations with Canada, he said: “Oh, definitely.” At the G7 summit, Trump from Canada asked, among other things, to move away from the tax. “It is something you have checked that you have now agreed, and that means that we can resume negotiations.”
Last week Trump announced all the talks
On Friday, the US President revealed “all” trade talks with Canada and threatened the neighboring country with new tariffs. As the reason for the demolition of the trade talks, Trump cited the Canada planned introduction of a digital tax to business in American companies. This is “a direct and unabashed attack on our country,” said Trump. Canada probably copy the European Union, which did that too. There are ongoing discussions with the EU.
The Canadian government said that Carney and Trump had agreed to resume negotiations in order to reach an agreement by July 21, 2025. Canada’s Finance Minister François-Philippe Champagne said that the lifting of the planned digital tax would make it possible for negotiations to make a new economic and security relationship with the United States decisive progress.
The Canadian government had introduced a new digital tax (DST) a year ago, i.e. during the term of office of US President Joe Biden. According to the information, the DST obliges large domestic and foreign companies to pay a three percent tax on certain sales, which they achieve by online users in Canada. With the procedure, Canada wants to ensure a taxation of digital companies where they make profit – in this case in the American neighboring country.
