This announcement follows a telephone interview between Prime Minister Mark Carney and US President Donald Trump, just a few hours before the first payment of the tax for large technological companies like Amazon and Google.
Friday, Donald Trump announced on his social media platform Truth Social which he ended all trade discussions with Canada because of this tax.
“When the new Government of Canada participates in negotiations on a new economic and security partnership between Canada and the United States, it is still guided by the general positive repercussions of any agreement for workers and businesses in Canada, Prime Minister Carney said. Today’s announcement will help resume negotiations to comply with the time of July 21, 2025 agreed earlier this month at the G7 leaders’ summit in Kananaskis. ”
A spokesperson for Mark Carney confirmed the call with Donald Trump and added that Minister Champagne also met on Sunday with the US Treasury Secretary Scott Bessent.
In his Friday message, Donald Trump described the “direct and flagrant attack” digital attacks on the United States and threatened to strike Canada from a new series of punitive customs duties, saying that he would inform Canada by July 4 of “business with the United States”.
This is a sudden turnaround on the part of the president, less than two weeks after MM. Trump and Carney apparently had a positive bilateral discussion at the G7 summit, where they had agreed to try to conclude their commercial negotiations within one month.
MM. Carney and Trump have been negotiating since the beginning of May, during his visit to the White House after the end of the Canadian elections. At the start of the campaign, the two countries agreed that Canada and the United States would work on a new economic and security agreement once Canadians have chosen their new government.
These discussions took place after Donald Trump imposed punitive customs duties in Canada, as in most other countries. Earlier this month, Donald Trump doubled the already devastating customs duties on aluminum and steel, bringing them to 50 %.
Neither Donald Trump nor the White House has yet commented on Canada’s decision to repeal the tax.
The tax was to apply to all large technological companies that operate online marketplaces, advertising services and social media platforms, as well as those that draw income from certain user data sales. It was not specific to the United States, but most of the companies concerned are American, including Google, Meta and Amazon.
The United States has criticized this tax for years, and the administration of former president Joe Biden has exerted strong pressure on Canada so that it does not follow up. In August, the Biden administration launched consultations on dispute settlement with Canada as part of the Canada-States-Mexico Agreement.
The United States allegedly alleged that the tax was discriminatory against American companies.
The tax had been promised for the first time by the Liberals in 2019, under the direction of the Prime Minister of the time, Justin Trudeau. This tax was announced in the economic statement of the fall of 2020 and entered into force in 2024.
The first payment, made on Monday, was to be retroactive over three years and was estimated at nearly $ 2 billion. The budget parliamentary director had previously estimated that Canada would collect about $ 7.2 billion over five years thanks to this tax.
Daniel Béland, professor of political science at McGill University in Montreal, described the withdrawal of Mark Carney as “clear victory” for Donald Trump.
“At one point, this decision could have proven to be necessary in the context of the Canadian-American trade negotiations, but Prime Minister Carney acted now to appease President Trump and get him to agree to simply take over these negotiations, which constitutes a clear victory for the White House and large technological companies,” said Béland.
He added that it made Mark Carney vulnerable to President Trump.
“President Trump forced Prime Minister Carney to do exactly what large technological companies wanted. American leaders in the technological sector will be very satisfied with this result, ”concluded Mr. Béland.
