U.S. to restart trade negotiations with Canada, White House says after digital services tax scrapped

The United States will restart trade negotiations with Canada immediately, after Canada scrapped its digital services tax targeting U.S. technology firms, White House economic adviser Kevin Hassett said on Monday.
 
"Absolutely," Hassett said on Fox News when asked about the talks restarting. U.S. President Donald Trump had asked the Canadians to take the tax off at the G7 meeting in Canada, he said.

"It's something that they've studied, now they've agreed to, and for sure, that means that we can get back to the negotiations."

Trump originally said Friday he was ending all U.S. trade discussions with Canada because of the digital services tax, which would have seen U.S. companies like Amazon, Google, Meta, Uber and Airbnb pay three per cent on revenues from Canadian users.

The policy, with tax collection set to begin Monday, would have applied retroactively, leaving U.S. companies with a $2-billion US bill due at the end of the month.

Canada and the U.S. have been locked in talks for months to get Trump to lift his punishing tariffs on Canadian goods, with the U.S. president and Prime Minister Mark Carney agreeing at the recent G7 summit to reach some sort of deal on the trade dispute within 30 days — by July 21.

The Prime Minister's Office confirmed to CBC News that Carney and Trump spoke on the phone sometime between Friday and Sunday night, when Canada rescinded the tax.

Despite the move, Canada is still in active discussions with G7 allies to introduce an international tax, with Finance Minister François-Philippe Champagne leading that work, the PMO said.

"President Trump has once again leveraged the power of the American economy, the best and biggest in the world, to deliver a victory for American industries and workers," White House spokesperson Kush Desai said in a statement to CBC News on Monday.

Thank you Canada for removing your Digital Services Tax which was intended to stifle American innovation and would have been a deal breaker for any trade deal with America. https://t.co/b944wQ4cyn

— Howard Lutnick (@howardlutnick) June 30, 2025

U.S. Secretary of Commerce Howard Lutnick shared a statement on social media on Monday morning praising Canada's decision to scrap the tax. 

"Thank you Canada for removing your Digital Services Tax, which was intended to stifle American innovation and would have been a deal-breaker for any trade deal with America," he wrote on X.