KABUL (Pajhwok): US President Donald Trump has abruptly cut off trade talks with Canada in response to its decision to implement a digital services tax targeting American technology companies.
Calling the tax a 鈥渂latant attack,鈥 Trump announced that he would impose new tariffs on Canadian goods within the next week, Reuters reported.
The move comes ahead of Canada鈥檚 plan to begin collecting the tax starting Monday on major US tech firms, including Amazon, Meta, Google and Apple.
In a post on his Truth Social platform, Trump said: 鈥淭his is a direct and blatant attack on our country. Canada has always been a very difficult country to trade with.鈥
鈥淏ased on this egregious tax, we are hereby terminating ALL discussions on trade with Canada, effective immediately,鈥 he added. 鈥淲e will let Canada know the tariff they will be paying to do business with the United States within the next seven-day period.鈥
Speaking to reporters at the White House, Trump said trade negotiations would not resume 鈥渦ntil they straighten out their act,鈥 emphasizing that the U.S. holds 鈥渟uch power over Canada.鈥
In response to Trump鈥檚 announcement, the office of Canadian Finance Minister Mark Carney stated: 鈥淭he Canadian government will continue to engage in these complex negotiations with the United States in the best interests of Canadian workers and businesses.鈥
Meanwhile, in a CNBC interview, White House economic adviser Bessent sought to downplay the dispute, suggesting that US Trade Representative Jamieson Greer may open a Section 301 investigation into Canada鈥檚 digital tax. Such a probe could pave the way for tariff retaliation equivalent to the estimated $2 billion impact on US firms.
Canada is currently the second-largest US trading partner after Mexico and the top buyer of US exports. Last year, Canada purchased $349.4 billion worth of American goods and exported $412.7 billion to the US, according to data from the US Census Bureau.