White House says Canada’s Carney ‘caved’ to Trump on tech tax
The White House said Canadian Prime Minister Mark Carney had “given up” to President Donald Trump’s pressure to cancel a tax on large American technological companies.
The White House press secretary Karoline Leavitt told journalists on Monday that Canada had made a mistake trying to take the tax, and that Carney called Trump on Sunday evening to say that he drops him.
Since Trump returned to functions, the two countries have been fighting for trade. In response to the tax, which he described as a “flagrant attack”, Trump canceled commercial transactions on Friday and threatened to increase prices.
Canada then said that it would stop paying payments, which was due on Monday and would present legislation to eliminate the tax.
“President Trump knows how to negotiate, and he knows that he governs the best country and the best economy in this world,” said Leavitt in response to a question from a journalist.
“Each country on the planet must have good relations with the United States,” she said, and called on the suppression of the tax a “great victory for our technological companies and our workers here at home”.
The Canada Digital Services Tax (DST) would have indicated that American technology giants, including Amazon, Meta, Google and Apple, had to face 3% costs on Canadian income greater than $ 20 million (15 million pounds sterling).
Sunday, the Minister of Finance of Canada, François-Philippe Champagne, published a statement saying that the tax would be canceled.
“The DST was announced in 2020 to respond to the fact that many major technological companies operating in Canada cannot pay a tax on income generated by Canadians,” he said.
“Canada’s preference has always been a multilateral agreement linked to the taxation of digital services,” added the press release.
Pierre Poilievre, the leader of the Conservative Party of the Opposition of Canada, criticized the suppression of the tax at the “11th hour”.
In an article on X, he said that the Prime Minister had “spent his elbows” – in reference to the “elbow” sentence used by Carney and his Liberal Party in the April elections to signify that they were ready to defend Canadian interests against the United States.
Hairyvre has urged Carney to “insist that the United States immediately cancels the pricing of wood” in exchange, adding that “we must make gains for our workers in these discussions”.
Many countries, including the United Kingdom, change the way they tax large multinational technology companies, which have millions of customers and advertisers worldwide, but high tax bills because of how their activities are structured.
It has been estimated that Canada’s tax would cost technology giants more than $ 2 billion Canadian dollars ($ 1.5 billion; 1.06 billion pounds sterling) during its first year, as the tax was applied retroactive to January 2022.
Last year, the federal budget estimated that the tax would bring back $ 5.9 billion in total in the next five years.
