Trump Ends Trade Talks with Canada Over Digital Tax Dispute

President Donald Trump announced the end of trade talks with Canada and plans to impose new tariffs in response to Canada's digital service tax. Trump called the tax an attack on the US and stated that all trade discussions with Canada are terminated immediately. The new tariff rate will be revealed within the next seven days.

Trump has criticized digital service taxes as trade barriers, with Canada's new tax set to take effect soon. These taxes allow countries to tax online services, affecting big tech companies like Meta, Apple, Google, Amazon, and Microsoft. Canada is the top buyer of American goods, while also exporting a significant amount to the US.

If Canada proceeds with the tax, Trump is prepared to impose higher tariffs on Canadian goods, potentially leading to a trade war. Canadian officials are considering their response, with hopes to resume negotiations. Business groups in Canada are urging the government to reconsider the tax to avoid escalating tensions.

Trump previously threatened tariffs on Canadian exports, but most goods are currently exempt under the USMCA agreement. However, certain products like cars, steel, and aluminum face tariffs. Canada has retaliated with tariffs on US goods in response. Other countries may also face tariffs if trade deals are not reached by a deadline.

Stocks rose despite Trump's tariff announcement, with major indices closing at record highs. The situation is evolving, with ongoing discussions and developments expected.

According to the source: CNN.