Cancellation of the tax on digital services: strategic withdrawal or expensive error?

In the aftermath of Ottawa’s announcement by the cancellation of the tax for large technological companies like Amazon and Google, opinions are shared as to the impact that such a measure could have.

On the pragmatics side, we find former Prime Minister Jean Charest, who sits on the Prime Minister’s council on Canadian-American relations.

According to him, Canada’s decline was A difficult decisionbut also A strategic withdrawal Who aims to keep Mr. Trump at the negotiating table with a larger objective: that of arriving at a global agreement with the United States by July 21, which would notably regulate trade disputes affecting steel, aluminum and automobile where thousands of jobs are at stake.

Sometimes you have to accept a step back to get a greater gainexplained Mr. Charest in an interview on the program A whole morningon here first.

The former Prime Minister of Quebec is making an analogy with fishing to illustrate the situation of Ottawa currently: It’s like having a 40 lb salmon at the end of an 8 lb line, you have to go up very slowly, be very patient.

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The American Secretary of Commerce, Howard Lunick, thanked Canada on social networks, saying that this tax would have been a major obstacle at any commercial agreement with the United States.

The White House reacted later by affirming that once again President Trump has exploited the power of the American economy, the best and largest in the world, to offer a victory to American industries and workers.

The abandonment of digital tax, a “strategic withdrawal”, according to Jean Charest

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“Very worrying”

The cancellation of the digital services tax (TSN) occurred just before the payment of the first payment of the tax for large technological companies making more than $ 2 million in turnover in Canada, such as Amazon and Google, but also Quebecor. The gains were valued at $ 7 billion over 5 years.

President, Donald Trump, said on Friday that the United States ended all trade negotiations with Canada because of this qualified tax asDirect and blatant attack against the United States.

Now that this tax has disappeared for good, in exchange, the Prime Minister should insist that the United States immediately cancels customs duties on wood. We must obtain gains for our workers as part of these negotiationssaid conservative chief Pierre Hairy on social networks.

For the chief of the block, Yves-François Blanchet, the decline of Mark Carney is very disturbing. Mr. Blanchet stressed that the Prime Minister of Canada has already done Heavy compromise in defense, borders and counter-tale, then here it is backing on a consensual measure of culture protection, and always without showing, no gain or any progress for Quebec and Canada.

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The interim leader of the new Democratic Party, Don Davies, affirms on social media that the decision to end the tax on digital services returns to Purely and simply give in to Trump and his billionaire friends.

According to him, Mr. Carney’s opening to the anti -missile defense plan Dome of Mr. Trump and his race to reach the new threshold of 5 % of the defense expenses of theTake, It seems more and more that Mr. Carney had the elbows raised during the pre-match skating session-to drop them once the match started.

Reviews shared by the professor of political science at McGill University in Montreal Daniel Béland who believes that Ottawa’s decision to retreat was taken a little too quickly in the negotiation process and that it weakens Mark Carney’s position against the American president.

For the Canada Chamber of Commerce, the decision to eliminate the TSN is logical. According to the organization, This tax would have weighed on Canadian consumers, companies and investors in the form of higher costs and would have harmed our economy at a critical time.

Its removal brings us closer to a renewed and reliable trade agreement with the American administration, which will help secure and increase trade already considerable from $ 3.6 billion per day between our two countries.

For its part, the American Chamber of Commerce in Canada (Amcham Canada) spoke of A constructive decision which allows the two countries to focus on strengthening their economic partnership.

“In the end, it will be necessary to tell him that he won”

By withdrawing from negotiations on Friday, Donald Trump also denounced the “prices” that Canada imposes, according to him, on dairy products, thus seeming to refer to the supply management system.

Jean Charest does not however believe that the American president will try to push his advantage until asking for the end of the supply management system which protects certain Canadian farmers.

First of all, the United States also has subsidies in certain sectorshe said by evoking sugar or fisheries. In his first mandate, Trump had recognized “the legitimacy of supply management,” he also recalled.

The former Prime Minister of Quebec also has On the reaction of the stock market marketswhich generally react badly to Trumpian threats, to restore balance.

But regardless of the result of the negotiation, at the end, it will be necessary to tell him that he wonconcluded Jean Charest, specifying that in behind the scenes, discussions were advancing fairly well.