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Donald Trump said that the United States was “ending” commercial conversations with Canada in retaliation against a new digital services tax on technology companies, reviving a bitter commercial war in North America after months of detente.
“Canada, a country very difficult to trade.
“According to this atrocious tax, we are finishing all the discussions of trade with Canada, with immediate effect,” Trump added.
The president said he would establish a new rate in Canadian imports “within the next period of seven days.”
Friday’s announcement immerses the two nations in a commercial war, leading an abrupt end to a period of more cordial relations that followed Mark Carney’s choice as Canadian prime minister in March.
Carney, who was driven to the Premier League for a wave of united anti-state feeling, sought to restore relations with Washington that had become tense under his predecessor Justin Trudeau. The first meetings between the couple were friendly, but Trump’s outburst threatens to undo the progress.
“The Canadian government will continue to participate in these complex negotiations with the United States in the best interest of Canadian workers and companies,” said Prime Minister’s office.
The Canadian dollar fell into Trump’s statement when merchants reacted to the new escalation of the commercial dispute, leaving it under 0.7 percent against the US dollar in the day. The S&P 500 also fell from its maximum of the day, but the blue chip index remained at approximately 0.3 percent.
Canada received Trump at the G7 summit earlier this month. After their conversations, Carney published in X that the two countries had “agreed to continue negotiations towards an agreement in the next 30 days.”
Trump’s side occurs after Canadian finance minister François-Philippe Champagne said this month that Ottawa was “forward” with plans for a digital services tax despite the doubts of the Trump administration.
The measure would hit the technological groups with a 3 percent tax on the income obtained from Canadian users and Silicon Valley has opposed the opposite.
Foreign companies such as Meta, Netflix and Amazon, as well as local companies, must submit a statement for the tax for the end of the month or face a fine.
Trump also attacked in the Canadian agricultural policy, a long -standing dispute area among the countries that date back to the president’s first mandate.
“They have charged our farmers up to 400% tariffs, for years, in dairy products,” he wrote in their real social publication on Friday.
Canada recently approved the legislation on “supply management” measures to protect its dairy industry through price establishment and production quotas, a system described by Trump in 2017 as a “misfortune.”
Trump’s return to the office caused a commercial war between Washington and Ottawa after he announced 25 percent tariffs on Canadian goods. These levies were later modified with thaws of products covered by the USMCA trade agreement, but the new sector tariffs on steel and aluminum have reached hard Canada.
The commercial acrimony, together with the president’s threat to Annexar Canada as state 51 of the United States, has caused a wave of resentment to the north of the border.
The Canadian industry groups criticized the digital services tax on Friday and urged the government to discard it to placate Trump.
“For many years, we have warned that the implementation of a unilateral tax of digital services could risk undermining Canada’s economic relationship with its most important commercial partner, United States,” said Goldy Hyder, president of the Canadian Business Council. “That unfortunate development has already happened.”
