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Donald Trump said that the USA “ended” trade talks with Canada in retaliation against a new digital services tax for technology companies and reopened a trade war between the countries after months of relaxation.
“Canada, a very difficult country that can be acted with … has just announced that they do a tax digital services tax tax on our American technology companies, which are a direct and obvious attack on our country,” said the US President of his truth on his social platform.
“Based on this outrageous tax, we hereby end all discussions about the trade with Canada that are immediately effective,” said Trump, adding that he would set a new tariff set for Canadian imports “within the next seven days”.
The announcement forfeits a trade war with the northern neighbor of the United States and ends a time with more warm relationships that followed Mark Carney as Canadian Prime Minister.
A spokesman for Carney said on Friday that they would check President Trump’s post “at the same time as everyone” and answer as soon as possible.
At the beginning of this month, Finance Minister François-Philippe Champagne said that the government was “progressing” with the digital service tax, although it was a great charm for the Trump management.
The measure would meet Tech groups with a fee of 3 percent to revenue from Canadian users and was rejected by Silicon Valley.
The Canadian dollar fell on the announcement and let it reduce by 0.7 percent on that day compared to the US dollar. Trump’s statement also threw the S&P 500 out of its highs of the day, but the blue chip index remained by about 0.2 percent.
Tensions between the two counties compared to Canadian agricultural policy were also cooked.
Canada recently passed laws on “offer management” measures that protect its dairy industry with price settings and production rates. In 2017, Trump described this system as a “shame” during his first presidency.
“You have been charged with our farmers of up to 400% tariffs for dairy products for years,” Trump wrote in his truth on Friday in his social post.
