Canada cancelled the Digital Services Tax (DST) on Sunday (June 29), according to Kevin Hassett, the Director of the White House National Economic Council, on Monday (June 30). He mentioned that as part of ongoing trade negotiations, the White House may seek more countries to abolish the Digital Services Tax. He expected that this tax, which is detrimental to American companies, could be eliminated globally.
Hassett expressed his delight during an interview with CNBC’s “Squawk on the Street,” stating that Canada’s decision to cancel the Digital Services Tax meant that retaliatory measures against Canada’s tax by the U.S. would not be necessary. However, it is anticipated that any country imposing the Digital Services Tax on American companies will displease the U.S. due to their unfair trade practices.
“I expect the Digital Services Tax to be abolished globally, which will be a key part of the trade negotiations we are currently engaged in,” he said.
On June 27, President Trump suddenly announced the termination of all trade negotiations with Canada due to their imposition of the Digital Services Tax. On June 29, Canada announced the withdrawal of the tax to advance their discussions with the U.S. for “broader trade negotiations.”
Canada reported that negotiations with the U.S. have resumed since the tax’s cancellation. Prime Minister Trudeau and President Trump aim to reach a trade agreement by July 21.
Regarding the trade negotiations conducted by the U.S. with various countries, Hassett stated that the U.S. has developed a “framework” for “a series of agreements” which will be reached shortly after Congress passes Trump’s “Big and Beautiful Bill.”
The Trump administration is eager for the Republican-controlled House and Senate to swiftly pass the final version of the bill and submit it to the President before July 4.
Hassett predicted that if Congress passes the “Big and Beautiful Bill,” a “marathon meeting” will be held in the Oval Office where Trump and his staff will review lists of countries and ultimately decide on tariff rates for each country.
The Digital Services Tax is a tax levied on income generated by multinational tech companies providing digital services in a particular country. Canada’s Digital Services Tax was originally set to take effect on June 30, requiring American tech giants such as Amazon, Google, and Netflix to pay up to $2 billion in taxes by the end of June. Trump strongly opposed this tax, considering it a discriminatory tax policy against American tech companies.