Canada Drops Digital Services Tax on U.S. Tech Firms Amid Trump Pressure and Ongoing Trade Talks

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Published Jul 5, 2025, 12:29 AM

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The Canadian government has decided to abandon its digital services tax targeting major U.S. technology companies, a move characterized by the White House as Canada "caving" to President Donald Trump. This decision has sparked renewed criticism in Canada over perceived concessions to Washington amid ongoing bilateral trade negotiations. While the tax has been scrapped, surcharges imposed by tech giants on Canadian advertisers remain in place.

Observers note that this reversal, unlike previous policy changes under former Bank of Canada Governor Mark Carney, may carry significant costs for Canada, as it effectively trades the tax for the opportunity to continue negotiations with the U.S. government. The development has raised concerns domestically about the implications of yielding to U.S. pressure on digital taxation policies.

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#Canadian #White House #Canada #Donald Trump #Washington #Bank of Canada #Mark Carney

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thestar.com(2)elnuevoherald.com theglobeandmail.com economist.com

el Nuevo Herald

@elnuevoherald

Canada's decision to eliminate US technology tax raises concerns

The Globe and Mail

@globeandmail

Tech giants’ surcharges on Canadian advertisers remain, despite Ottawa’s vow to scrap digital services tax

The Economist

@TheEconomist

Unlike Mark Carney’s previous reversals on Justin Trudeau’s policies, scrapping the digital-services tax in exchange for the privilege of merely negotiating with Donald Trump may prove costly

Story Timeline

13 days ago•Latest version

Canada Drops Digital Services Tax on Big Tech After Pressure From President Trump, Prime Minister Carney; Refunds Delayed by Revenue Agency

15 days ago•Original version

Canada Drops Digital Services Tax on U.S. Tech Firms Amid Trump Pressure and Ongoing Trade Talks

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Canada Drops Digital Services Tax on U.S. Tech Firms Amid Trump Pressure and Ongoing Trade Talks

Financial Analysis

Associated Financial Markets

Related Prediction Markets

Canada tariffs on China in effect before July?

Will Trump lower tariffs on Canada by...?

35% Canada tariff in effect by August 1?

Sources

Story Timeline

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