Canada Withdraws Digital Services Tax Just Before Implementing to Restore US Trade Talks

Canada’s Finance Minister says repealing the digital services tax is key to advancing a broad economic and security deal with the US after talks broke down.

Canada has officially scrapped its Digital Services Tax (DST), hours before the measure was set to take effect, in a bid to revive stalled trade talks with the US and ease escalating tensions.

The announcement came late Sunday when Canada’s Department of Finance announced it would suspend enforcement of the DST and move to repeal the measure through legislation. The payments were scheduled to start on Monday, June 30.

The decision follows a sharp breakdown in discussions on Friday, when US President Donald Trump abruptly pulled out of trade negotiations, describing the tax as a “blatant attack” on American tech companies.

Canada’s Finance Minister François-Philippe Champagne said the reversal reflects a broader effort to secure a comprehensive economic and security agreement ...