Fact Check: Trump Cancels All Trade Talks with Canada Over New Tech Tax
What We Know
On June 27, 2025, President Donald Trump announced that he was suspending all trade discussions with Canada due to the country's decision to implement a new digital services tax targeting large technology firms, including U.S. companies like Amazon, Google, and Meta. Trump characterized the tax as “a direct and blatant attack on our country” and stated that discussions would be terminated “effective immediately” (AP News, Washington Post). The tax was set to take effect shortly after his announcement, which added urgency to his decision.
The digital services tax is designed to apply to companies that earn over 20 million Canadian dollars from digital services in Canada, imposing a 3% levy on their revenue. This tax has been a contentious issue, drawing criticism from U.S. officials and business groups who argue it discriminates against American companies (Reuters, Al Jazeera).
Analysis
The claim that Trump canceled all trade talks with Canada over the new tech tax is supported by multiple credible sources. Trump's own statements on social media and during press conferences confirm that he explicitly linked the termination of trade discussions to Canada's implementation of the digital services tax. He referred to the tax as “egregious” and indicated that the U.S. would respond with new tariffs (AP News, Washington Post).
The reliability of the sources reporting this event is high, as they include established news organizations such as the Associated Press, Washington Post, and Reuters, which are known for their journalistic standards and fact-checking protocols. These outlets reported on Trump's statements and provided context regarding the ongoing trade negotiations and the implications of the new tax (Reuters, CNBC).
While some sources noted that the digital services tax had been anticipated for some time, Trump's abrupt decision to halt negotiations just before its implementation suggests a strategic move to exert pressure on Canada (Al Jazeera). This aligns with Trump's historical approach to trade negotiations, where he often uses threats of tariffs and trade halts as leverage.
Conclusion
The claim that Trump canceled all trade talks with Canada over the new tech tax is True. The evidence from multiple reputable sources confirms that Trump's decision was directly linked to Canada's implementation of the digital services tax, which he viewed as a significant threat to U.S. economic interests. His statements reflect a clear intention to retaliate against what he perceives as unfair trade practices.
Sources
- Trump says he's terminating trade talks with Canada over ...
- Trump halts trade talks with Canada, defending interests ...
- Trump ends US trade talks with Canada over digital tax
- Trump ends all U.S. trade talks with Canada over digital ...
- What is Canada's digital tax and why is Trump killing trade ...
