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Canada Drops Digital Tax After Trump Pressure, Trade Talks Resume. Canada has scrapped its planned digital services tax on major U.S. tech companies following pressure from President Donald Trump. The tax would have imposed a 3% levy on revenues above $20 million for firms like Amazon, Meta, and Google. White House Press Secretary Karoline Leavitt said Prime Minister Mark Carney "caved" after Trump threatened new tariffs and halted trade talks. Carney confirmed the tax was dropped as part of a broader negotiation, and talks resumed Monday. U.S. officials hailed it as a win for American innovation, while Canada's opposition called the move a last-minute retreat. The now-abandoned tax was expected to raise nearly $6 billion over five years and was retroactive to 2022. The reversal marks a major shift in U.S.-Canada relations under Trump, as both countries return to the table to negotiate a wider trade deal.
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