Trump cuts off US trade talks with Canada, shattering optimism over tariff deals
WASHINGTON: US President Donald Trump on Friday (Jun 27) abruptly cut off trade talks with Canada over its new tax targeting US technology firms, calling it a "blatant attack" and saying that he would set a new tariff rate on Canadian goods within the next week.
The move, which plunges US relations with its second-largest trading partner back into chaos after a period of relative calm, came just hours after Trump's Treasury Secretary, Scott Bessent, struck an upbeat tone on trade.
It also follows a Jun 19 announcement by Canadian Finance Minister Francois-Philippe Champagne that Canada would not pause its longstanding plans to implement a digital services tax starting Jun 30 on US technology firms including Amazon, Meta, Google and Apple, among others.
Trump, in a post on his Truth Social media platform, called the tax "a direct and blatant attack on our country" and said Canada was a "very difficult country to trade with."
"Based on this egregious tax, we are hereby terminating all discussions on trade with Canada, effective immediately," Trump said. "We will let Canada know the tariff that they will be paying to do business with the United States of America within the next seven day period."
Canada is the second-largest US trading partner after Mexico, buying US$349.4 billion of US goods last year and exporting US$412.7 billion to the US, according to US Census Bureau data.
Canadian Prime Minister Mark Carney said on Jun 16 he had agreed with Trump that their two nations should try to wrap up a new economic and security deal within 30 days.
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