Simply hours earlier than Canada’s new Digital Companies Tax was set to enter impact, the Canadian authorities introduced that it rescinded the levy “in anticipation of a mutually useful complete commerce association with the US.”

Canada scrapped the Digital Companies Tax after U.S. President Donald Trump on Friday had blasted Canada’s 3% Digital Companies Tax as “direct and blatant assault on our Nation.” Trump, in a publish on social media, stated that due to the “egregious Tax, we’re hereby terminating ALL discussions on Commerce with Canada, efficient instantly.”

Late Sunday (June 29), the Division of Finance Canada introduced the termination of the Digital Companies Tax, which might have imposed a 3% surcharge on streaming companies, on-line marketplaces, social media companies and different digital companies. Canada’s authorities had been set to begin gathering income from the tax on Monday, June 30; that may now be halted. François-Philippe Champagne, Canada’s Minister of Finance and Nationwide Income, will quickly carry ahead laws to rescind the Digital Companies Tax Act, in response to the division.

Canadian Prime Minister Mark Carney and Trump “have agreed that events will resume negotiations with a view in direction of agreeing on a deal by July 21, 2025,” in response to the Division of Finance Canada.

Canada’s Digital Companies Tax, introduced in 2020, was adopted “to deal with the truth that many massive know-how corporations working in Canada might not in any other case pay tax on revenues generated from Canadians,” in response to the federal government. The tax would have required affected corporations, predominantly large U.S. know-how companies, to pay as much as $3 billion to the Canadian authorities, together with retroactive expenses relationship again to 2022, in response to the U.S.-based Laptop & Communications Business Affiliation commerce group.

Carney stated in a press release issued Sunday, “In our negotiations on a brand new financial and safety relationship between Canada and the US, Canada’s new authorities will at all times be guided by the general contribution of any potential settlement to the very best pursuits of Canadian employees and companies. As we speak’s announcement will assist a resumption of negotiations towards the July 21, 2025, timeline set out at this month’s G7 Leaders’ Summit in Kananaskis.”

Pictured above: Canadian Prime Minister Mark Carney and President Donald Trump on the Kananaskis Nation Golf Course throughout the G7 Leaders’ Summit on June 16, 2025, in Kananaskis, Alberta, Canada