30 June 2025 : Canadian Prime Minister Mark Carney said on Sunday (local time) that trade negotiations with the United States have resumed after Canada dropped its plan to impose a tax on American technology companies.
Carney’s office confirmed that both Carney and Trump have agreed to restart trade discussions. “Today’s announcement will support a resumption of negotiations toward the July 21, 2025, timeline set out at this month’s G7 Leaders’ Summit in Kananaskis,” Carney said in a statement.
Earlier on Friday, US President Donald Trump announced he was suspending trade talks with Canada due to its intention to move forward with the digital services tax, which he described as “a direct and blatant attack on our country.”
In response, the Canadian government stated that “in anticipation” of reaching a trade agreement, Canada would rescind the Digital Services Tax, which was originally scheduled to take effect on Monday.
Digital services tax was set to impact tech giants like Google, Amazon, Meta
In a post on his social media platform Friday, US President Donald Trump said Canada had informed the US it would proceed with implementing the digital services tax. The measure targets both Canadian and foreign companies that interact with online users in Canada. Trump’s post marked another sharp turn in the ongoing trade tensions he has fueled since returning to office for a second term in January.
The proposed tax was expected to impose a 3% levy on revenue generated from Canadian users by companies such as Amazon, Google, Meta, Uber, and Airbnb. It was also set to be applied retroactively, potentially leaving US firms with a combined tax bill of $2 billion by the end of the month.
Talks between the two countries have fluctuated, with Trump often taunting Canada and at times suggesting it could be absorbed as a US state.
Carney visited Trump at the White House in May, where their meeting was described as courteous but resolute.
During the G7 summit in Alberta, Trump made a reciprocal visit, after which Carney announced that Canada and the US had agreed on a 30-day timeline to move forward with trade negotiations.
Summary:
PM Mark Carney confirmed Canada withdrew its digital services tax, leading to the resumption of stalled trade talks with the U.S. ahead of a potential deal.