Canada has reversed its digital tax plan on U.S. tech firms, reopening the door for trade talks with the United States after a brief collapse last week, NaijNaira can report.
The standoff began when U.S. President Donald Trump suspended all trade negotiations in response to Canada’s plan to impose a 3% digital services tax. The Associated Press first reported the sudden breakdown.
The tax would have hit companies like Google, Amazon, Meta, Airbnb, and Uber with backdated charges worth over $2 billion.
After a direct phone call between Prime Minister Mark Carney and President Trump on Sunday, both sides agreed to resume talks.
“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.
Finance Minister François-Philippe Champagne confirmed the tax withdrawal, saying it clears the way for broader negotiations on economic and security ties.
“Rescinding the digital services tax will allow the negotiations of a new economic and security relationship with the United States to make vital progress,” Champagne said.
Trump had previously blasted the tax, calling it “a direct and blatant attack on our country.”
Daniel Béland, a political analyst at McGill University, called the move “a clear victory for both the White House and big tech.”
“President Trump forced PM Carney to do exactly what big tech wanted,” Béland added.
With tariffs still looming, the next round of talks will determine if this truce sticks or unravels under the pressure of Trump’s trade agenda.
Article updated 4 hours ago. Content is written and modified by multiple authors.
