Predicable Outcome with the Fox in the Henhouse
"We have just been informed that Canada, a very difficult Country to TRADE with ... has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country."
"Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period."
U.S. President Donald Trump
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"The Canadian government will continue to engage in these complex negotiations with t he United States in the best interests of Canadian workers and businesses."Office of the Prime Minister"That unfortunate development [Business Council of Canada warning the tax implementation risks destabilizing Canada's economic relationship with the U.S.] has now come to pass.""In an effort to get trade negotiations back on track, Canada should put forward an immediate proposal to eliminate the DST in exchange for an elimination of tariffs from the United States.""We continue to support our government's efforts to negotiate the best deal possible for Canadians."Goldy Hyder, president/CEO, Business Council of Canada"That's the law in Canada. We had fairly long, extensive discussions at the G7 about the different regimes that you find in different parts of the world.""That's not unique [a Digital Services Tax] to Canada, by the way.""[Canada is prepared to move ahead with the tax, irritant with the U.S. or not]."Canadian Finance Minister Francois-Philippe Champagne
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| Donald Trump abruptly ended trade talks with Canada over the digital services tax, which he calls ‘a blatant attack’ on the U.S. CBCNews |
Canada is desperately working toward an agreement with the Trump administration for an economic and security pact. Canada's new Liberal Prime Minister Mark Carney had announced following the G7 summit in Alberta, that "the right deal is possible, but nothing's assured". Obviously lulled into a sense of mild complacency cushioned by his obsequious flattery and catering to the ego of the American president, taking great care not to endanger the delicate maneuverings of the trade talks Mr. Carney somehow overlooked the obvious provocation of the tax's impact.
The first payment of the digital tax levied amounting to three percent of digital services revenue produced from Canadian users above $20 million annually covering revenue retroactively to 2022, was due to take place Monday, June 30. Major American companies like Meta, Google, Airbnb and Amazon were set to be affected by the tax. Canada made its DST intention implementation years ago, with the legislation enacting the tax brought into law a year ago.
This tax levied on giant American corporations is reflected in the finances of countries other than Canada. The situation is a recognition of the immense profits produced by entry into the Canadian market of such U.S. market forces. On the other hand, the Trump administration has not been shy about its aggressive program of exacting tariffs on foreign-produced products and services entering the American market. Tariffs of surprising steepness, exacted by President Trump, ostensibly to counter the 'unfair' practices taxation of foreign countries imposed on the United States.
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| President Trump Attends G7 Summit in Canada by White House https://www.whitehouse.gov/gallery/ |
Accusing Canada of 'copying' the European Union where many member countries have put in place a digital services tax, President Trump made it clear that any agreeable, friendly-neighbour discussions on trade were to be swept off the negotiating table, as punishment for the DST tax. Earning Canada sky-high 'reciprocal taxes'. 'Reciprocal Tariffs' of up to 50 percent threatened by the U.S. toward the European Union, has led to discussions between the Trump administration and the EU in hopes of avoiding their implementation.
Spain, in complaining that his country's GDP could never sustain a 5 percent dedication to military arms in compliance with the new NATO standard of member-nations investing a substantial portion of their gross national product in re-arming and re-investing in their military, has earned that country a cancellation of any trade talks, by an infuriated U.S. president that any nation would question his dictat to the global security group.
Agreements have concluded with a small number of countries on the world stage, China and the United Kingdom being two, while the process of completing trade deals with other countries are in the works. "But some will be disappointed because they're going to have to pay tariffs", warned the American president. Those that will be 'disappointed' will most certainly for the most part, feel the pain of this man's displeasure, on their economic outlook.
As it is, the fallout from the introduction of the U.S.-imposed tariffs has hit many businesses to the extent that small companies are losing sales and customers, and even large corporations are feeling the stress of decreased production as costs of materials being tariffed soar. So too will bankruptcies soar, the workforce diminished, and all countries affected by this new world economic destabilization facing reduced economic stability. The global fallout will not, in the final analysis, spare the American consumer.
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| People walk during Apple's annual World Wide Developers Conference at the company's headquarters in Cupertino, Calif., on June 9. Canada's digital services tax would hit tech giants like Apple if it came into effect on Monday. (Laure Andrillon/Reuters) |
News release June 29, 2025 - Ottawa, Ontario - Department of Finance CanadaCanada’s new government is engaged in complex negotiations on a new economic and security partnership with the United States, focused on getting the best deal for Canadian workers and businesses. Prime Minister Carney has been clear that Canada will take as long as necessary, but no longer, to achieve that deal.To support those negotiations, the Minister of Finance and National Revenue, the Honourable François-Philippe Champagne, announced today that Canada would rescind the Digital Services Tax (DST) in anticipation of a mutually beneficial comprehensive trade arrangement with the United States. Consistent with this action, Prime Minister Carney and President Trump have agreed that parties will resume negotiations with a view towards agreeing on a deal by July 21, 2025.The DST was announced in 2020 to address the fact that many large technology companies operating in Canada may not otherwise pay tax on revenues generated from Canadians. Canada’s preference has always been a multilateral agreement related to digital services taxation. While Canada was working with international partners, including the United States, on a multilateral agreement that would replace national digital services taxes, the DST was enacted to address the aforementioned taxation gap.The June 30, 2025 collection will be halted, and Minister Champagne will soon bring forward legislation to rescind the Digital Services Tax Act.
Vehicles cross the Blue Water Bridge over the St. Claire River to Port Huron, Michigan from Sarnia, Canada, in Port Huron, Michigan. (Photo by Jeff KowalskyAFP via Getty Images )
Labels: Global U.S. Tariff War, Trade Negotiations, U.S . President Donald Trump
posted by Pieface @ Tuesday, July 01, 2025
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