Trump Renews Attacks on Canada by Ending Trade Talks

President Trump has renewed his attacks on Canada by announcing he was abruptly ending trade talks.

The announcement comes less than two months after the relatively cordial Oval Office meeting between Trump and Canadian Prime Minister Mark Carney. 

I wonder if the rapprochement lulled Carney into a false sense of security because a few days ago he claimed that Trump no longer coveted Canada as the 51st state.

How long will it be before Trump starts calling Carney "Governor of Canada" as he did with his predecessor, Justin Trudeau?

As a result of Trump's announcement, Canada increased levies on U.S. steel imports.

Trump made his abrupt decision claiming that Canada "has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country."

As usual, Trump is full of shit. Canada did not just announce the DST. It was passed a year ago under the Trudeau government. However, it is due to take effect on Monday. The DST is a 3% levy on digital companies which earn more than $20 million in revenue from Canadian sources and would apply to tech giants like Apple, Amazon, AirBnB, Google, Meta and Uber. The tax is also retroactive to 2022.

It is possible Trump didn't learn of the DST until now given his propensity to stick his head up his ass. The Biden Administration was surely aware as it opposed the legislation but sought to utilize dispute settlement mechanisms which presently exist under the Canada U.S. Mexico Free Trade Agreement (CUSMA).

I can see Canada waiving part or all of the retroactivity of the DST while keeping the tax in place. Trump might demand that Canada scrap the tax, but a similar tax exists in various parts of the EU. Canada cannot scrap the tax as it would basically cede taxation policy to the White House. In which case, perhaps Canada might offer further assistance in immigration enforcement or defense spending in an effort to mollify Trump and allow bilateral trade talks to resume.

But rest assured, so long as he is in the White House, Trump is going keep pulling stunts like this against Canada every couple of months.