Mon, 30 Jun 2025

Mon, 30 Jun 2025 Canada drops tech tax to restart US trade talks

A new tax on technology firms is being halted after Trump threatened new tariffs on Canadian goods.

* Canada will rescind its digital services tax (DST) on US tech giants, including Amazon, Meta, Google and Apple
* The 3% tax would have charged companies with revenue above C$20m
* Payments were due on Monday but collection has been halted
* Canada's finance minister says the tax was introduced to address the fact that many large technology companies operating in Canada may not pay tax on revenues generated from Canadians
* The decision comes after US President Donald Trump called off trade talks and threatened higher tariffs on imports from Canada
* White House economic adviser Kevin Hassett said negotiations between the two countries would "absolutely" restart as a result of the decision
* Canada's estimated to lose C$2bn ($1.5bn; £1.06bn) in revenue from the tax in its first year, while the tech giants could have faced costs of over $2bn
* The US has welcomed the move and said it would be a "deal breaker" for any trade deal with America
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