Fact Check: Trump Threatens to End Trade Talks Over Canada's New Digital Tax
What We Know
On June 27, 2025, President Donald Trump announced that he would be suspending trade talks with Canada due to the country's plans to implement a new digital services tax targeting large technology firms, including U.S. companies like Amazon, Google, and Meta. Trump described the tax as “a direct and blatant attack on our country” and stated that the U.S. would terminate all discussions on trade with Canada effective immediately (AP News, Washington Post). The digital services tax is set to take effect shortly and will impose a 3% levy on revenue generated from Canadian users, which could cost U.S. tech companies between $900 million and $2.3 billion annually (Al Jazeera).
Analysis
The claim that Trump threatened to end trade talks over Canada's new digital tax is substantiated by multiple credible sources. Trump's announcement was made via a social media post where he explicitly stated that the U.S. would halt negotiations until Canada reconsidered its tax plan (AP News, New York Times). This aligns with his previous stance on trade negotiations, where he has often used tariffs and trade threats as leverage.
The reliability of the sources reporting on this event is high. The Associated Press, Washington Post, and New York Times are all established news organizations known for their journalistic integrity. They provided consistent accounts of Trump's statements and the implications of the digital tax. Furthermore, the context surrounding the announcement reflects ongoing tensions in U.S.-Canada trade relations, particularly regarding digital services taxes that have been a point of contention for some time (Washington Post, Al Jazeera).
However, it is important to note that while Trump's rhetoric is strong, the actual implementation of new tariffs and their potential impact on trade relations will depend on future negotiations and actions taken by both countries. Canadian Prime Minister Mark Carney indicated that Canada would continue to negotiate in its best interests, suggesting that the situation remains fluid (AP News, Washington Post).
Conclusion
The claim that Trump threatened to end trade talks over Canada's new digital tax is True. Trump's statements clearly indicate a suspension of negotiations in response to Canada's tax plans, which he perceives as harmful to U.S. interests. The evidence from multiple reputable sources supports this conclusion, highlighting the ongoing complexities in U.S.-Canada trade relations.
