Carney Liberals urged to ditch DST as Trump terminates trade talks with Canada
By Bryan Passifiume, published June 27, 2025 (read in the Toronto Sun)
OTTAWA – Canada’s insistence on taxing American tech companies for Canadian-sourced revenue has prompted the U.S. to walk away from ongoing trade negotiations.
In a social media post on Friday, U.S. President Donald Trump announced an immediate suspension of trade and tariff talks with Canada due to the Digital Services Tax (DST) – describing it as “egregious” and a “direct and blatant attack” on the U.S.
“Based on this egregious tax, we are hereby terminating all discussions on trade with Canada, effective immediately,” Trump wrote on TruthSocial. “We will let Canada know the tariff that they will be paying to do business with the United States of America within the next seven day period.”
In response, Canada had little to say regarding Trump’s statement.
“The Canadian government will continue to engage in these complex negotiations with the United States in the best interests of Canadian workers and businesses,” read the one-sentence statement from the PMO.
Ottawa has been under intense pressure to repeal the DST ahead of Monday’s deadline requiring online service providers to make good on retroactive payments on revenues collected since 2022 – a $2 billion tax bill the finance department confirmed this week is still due.
Under the law, non-Canadian digital services with annual incomes more than $1.1 billion must pay a 3% levy of all revenues from Canadian users exceeding $20 million.
Impacted companies include heavyweights like Amazon, Google, Facebook-parent company Meta, and Uber.
The tax, enacted a year ago via an order-in-council, was part of the Trudeau Liberal’s election platform since at least 2019.
Chrystia Freeland, speaking in June 2024 when she was still deputy prime minister, said Canada would be moving ahead, despite U.S. opposition.
“Its simply not reasonable, not fair, for Canada to indefinitely put our own measures on hold,” she said at the time. “Other countries have a DST in place right now, and they have had a DST in place for a number of years with no retaliation.”
Trump’s announcement also ends the government’s hopes the DST would become part of the ongoing trade negotiations, as mentioned by Finance Minister Francois-Philippe Champagne last week.
Opposition to the tax has been far-reaching, both here and in the United States.
Earlier this month, a letter signed by 21 members of the U.S. Congress urged the President to take action, saying the tax would cost U.S. tech companies billions.
Conservative Leader Pierre Poilievre expressed dismay at the suspension of the talks.
“The government must take emergency action to bolster Canada’s economy,” he wrote in a statement.
“Fully repeal the no-pipelines law, the industrial carbon tax, the tanker ban, the emissions cap, the EV mandate, and axe the capital gains tax on reinvestments in Canada. All to create a strong, self-reliant and sovereign Canadian economy.”
Goldy Hyder, president and CEO of the Business Council of Canada, said they’ve warned the government for years the DST would undermine Canada’s economic relationship with the U.S.
“That unfortunate development has now come to pass,” Hyder said. “In an effort to get trade negotiations back on track, Canada should put forward an immediate proposal to eliminate the DST in exchange for an elimination of tariffs from the United States.”
Alex Brown, a director with the National Citizens Coalition, told the Toronto Sun his sources said the DST has been a long-time irritant to the White House, and isn’t surprised at Trump’s reaction.
He said this – alongside the government’s refusal to repeal its anti-pipelines, anti-oil tanker and anti-energy extraction legislation – is yet another example of Carney hamstringing himself by clinging to unpopular Trudeau-era policy.
“We are paying for the mistakes of the last decade,” he said.
“As the author of the Art of the Deal, Trump has negotiated for more with less. Ten years of short-sighted and absent-minded Trudeau policy can be used as an excuse to get exactly what the Americans want.”
He said if the government clings to the DST, trade negotiations will instead become a reckoning for Canada.
“It won’t be pretty, and it won’t come as easy as the Prime Minister would have hoped,” Brown added.
With C-5 now law, it's 'put up or shut up time' for Carney Liberals: NCC
By Bryan Passifiume, published June 27, 2025 (read in the Toronto Sun)
OTTAWA — With Prime Minister Mark Carney’s keystone nation-building legislation now law, it’s time for the government to follow through on its promises.
“This is a ‘come to Jesus’ moment,” Senator Leo Housakos told the Toronto Sun on Friday.
“This is where they have to recognize that not everything they did in the last 10 years worked out as they thought it would, and now we need to make changes that reinforce economic development, economic growth and attracts foreign investment.”
Bill C-5, the One Canadian Economy act, enjoyed rare support from the Conservatives, who fended off opposition from the NDP and Bloc Québécois — and even members of the Liberal caucus — to usher the bill through whirlwind consideration in both the House of Commons and the Senate to meet Carney’s July 1 deadline.
C-5 is meant to grant cabinet mechanisms allowing for fast approvals for major nation-building projects such as pipelines, ports, mines and energy ventures, and lift barriers to interprovincial trade.
Housakos, oppositi
on leader in the Senate, said it’s now up to Carney to put the law into action and start rebuilding Canada’s stalled economy.
“The Prime Minister has created high expectations coming out of an election where clearly, regardless if Canadians voted for Mark Carney or Pierre Poilievre, there was a clear embracing of the recognition that in the last 10 years, the environmental enthusiasm displayed by the previous government went a little bit too far,” he said.
“It created too much red tape, created too many obstacles for unleashing our energy sector and creating the wealth our country so badly requires — particularly in the face of this existential crisis of tariffs and Trump threats that we’ve been getting now over the last few months.”
Alex Brown, a director with the National Citizens Coalition, agreed with Housakos’ sentiment that Carney and his government need to put their money where their mouth is.
“It’s put up or shut up time,” Brown said. “We view this with optimism but healthy skepticism, because the (government’s) record speaks for itself in cabinet and (Carney’s) past work as the sort-of ‘final boss’ of global net-zero.”
Canadians have kept a wary eye on the PMO since Carney came to power, he said, adding they are beyond hollow catchphrases like “elbows up” and are putting their faith in the PM’s tent-pole policies like breaking down interprovincial trade barriers.
“Nobody can sabotage Canada quite like Canada,” Brown said. “This is a real chance to take down a whole bunch of red tape, but if those first tentpoles have already appeared to collapse — folks are going to want to see some real movement this summer, and thinking ahead to when the house returns this September.”