Trump calls off trade talks with Canada over tax on US tech companies

Washington DC - President Donald Trump said Friday that he is calling off trade negotiations with Canada in retaliation for taxes impacting major US tech firms, adding that Ottawa will learn of their tariff rate within a week.

President Donald Trump said Friday that he is calling off trade negotiations with Canada in retaliation for taxes impacting major US tech firms, adding that Ottawa will learn of their tariff rate within a week. © JOE RAEDLE / GETTY IMAGES NORTH AMERICA / GETTY IMAGES VIA AFP

"Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately," Trump said in a post on his Truth Social platform.

He added that Canada will soon find out the levy it needs to pay to do business in the US, calling his country's northern neighbor "very difficult" to trade with.

Washington has previously taken issue with Canada's digital services tax, requesting dispute settlement talks last year over the matter.

While Canada's digital services tax is not new – it was enacted last year – US service providers are "on the hook for a multi-billion dollar payment in Canada" by June 30, noted the Computer & Communications Industry Association.

While Canada has been spared from some of Trump's most sweeping duties, such as a 10% rate imposed in early April on nearly all trading partners, it faces a separate tariff regime.

Since returning to the White House in January, Trump has also imposed steep levies on imports of steel, aluminum, and autos.

Trump announces he FAILED to strike a trade deal with Canada, blames them for being “very difficult” to trade with. pic.twitter.com/5oMEdckOTT

— Republicans against Trump (@RpsAgainstTrump) June 27, 2025

Last week, Canada said it would adjust its 25% counter tariffs on US steel and aluminum after Washington doubled its levies on imports of both metals to 50% – if a trade deal was not reached within 30 days.