In a significant policy shift, the Canadian government has announced it will reverse its stance on the digital services tax, expressing hopes for a beneficial trade agreement with the United States. The announcement was made late Sunday by officials in Ottawa.
This decision follows remarks from U.S. President Donald Trump, who indicated he would be “terminating ALL discussions on Trade with Canada” over the nation’s plan to tax American technology companies.
Canadian Prime Minister Mark Carney stated that this reversal is aimed at re-initiating discussions in line with the July 21, 2025 deadline established during the recent G7 Leaders’ Summit.
Francois-Philippe Champagne, Canada’s Minister of Finance and National Revenue, emphasized the importance of rescinding the tax as a way to foster negotiations that could lead to a new economic and security partnership with the U.S. He underscored that this move is intended to aid job creation and enhance prosperity for all Canadians.
Nonetheless, the finance ministry reaffirmed that while Canada is committed to reaching an agreement, it will take whatever time is necessary, but not extend the process unnecessarily.
Initially set to collect its first payments starting Monday, the digital services tax applied retroactively from 2022 and would have impacted both Canadian and international technology firms, including major American companies like Amazon, Google, and Meta with a levy of 3%.
— This is breaking news; please check back for updates.
