Canadian prime minister has blunt response after Donald Trump accused them of ‘blatant attack’
President Donald Trump has criticized Canadian Prime Minister Mark Carney, claiming that Canada’s new digital services tax is a direct attack on the United States. In response, Carney kept calm and said Canada will continue trade talks in the best interest of its people.
Tensions between the U.S. and Canada had cooled after Carney, a 60-year-old former banker, unexpectedly won the election in April. Trump, 79, seemed to have some respect for Carney due to their shared background in business.
Recently, Canada imposed a 25% tariff on general imports and a 10% tariff on energy products from the U.S., including a 25% tariff on American steel and aluminum. Despite these tensions, both countries had been negotiating a trade agreement that could benefit both sides.
However, Canada introduced a new digital services tax that will charge major American tech companies—such as Google, Amazon, Meta, Uber, and Airbnb—a 3% fee on money earned from Canadian users. This tax is retroactive, meaning companies will owe money dating back to earlier periods, totaling around \$2 billion USD.
Trump took to his social media platform, Truth Social, accusing Canada of being a difficult trade partner and targeting American companies unfairly. He pointed out that Canada has long placed high tariffs on American dairy products—up to 400%, he claimed—and now is following the European Union by taxing digital services.
In response to the tax, Trump announced that the U.S. is halting all trade negotiations with Canada and that new tariffs on Canadian goods will be announced within a week. He warned that Canada made a mistake and that things won’t turn out well for them.
When asked about Trump’s reaction, Carney simply said Canada will keep working through the complex trade discussions in a way that benefits Canadians. Trump later told reporters that the U.S. has strong economic leverage over Canada and would prefer not to use it—but hinted that Canada should cancel the tax if they want talks to resume.
Experts say this tax issue isn’t new. Daniel Béland, a political science professor in Montreal, explained that the law creating the digital tax was passed over a year ago, so U.S. tech companies have known about it for a while. Still, Trump chose this moment—just before the tax takes effect—to react strongly, possibly to influence the ongoing and uncertain trade negotiations between the two countries.
