Canadian Prime Minister Carney says trade talks with US resume after Canada rescinded tech tax

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Canadian Prime Minister Mark Carney and US President Donald Trump arrive for a family photo during the Group of Seven (G7) Summit at the Kananaskis Country Golf Course in Kananaskis, Alberta, Canada, on June 16, 2025. (AFP/File)
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Updated 30 June 2025
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Canadian Prime Minister Carney says trade talks with US resume after Canada rescinded tech tax

 

TORONTO: Canadian Prime Minister Mark Carney said late Sunday trade talks with US have resumed after Canada rescinded its plan to tax US technology firms.
US President Donald Trump said Friday that he was suspending trade talks with Canada over its plans to continue with its tax on technology firms, which he called “a direct and blatant attack on our country.”
The Canadian government said “in anticipation” of a trade deal “Canada would rescind” the Digital Serves Tax. The tax was set to go into effect Monday.
Carney’s office said Carney and Trump have agreed to resume negotiations.
“Today’s announcement will support a resumption of negotiations toward the July 21, 2025, timeline set out at this month’s G7 Leaders’ Summit in Kananaskis,” Carney said in a statement.
Carney visited Trump in May at the White House, where he was polite but firm. Trump traveled to Canada for the G7 summit in Alberta, where Carney said that Canada and the US had set a 30-day deadline for trade talks.
Trump, in a post on his social media network last Friday, said Canada had informed the US that it was sticking to its plan to impose the digital services tax, which applies to Canadian and foreign businesses that engage with online users in Canada.
The digital services tax was due to hit companies including Amazon, Google, Meta, Uber and Airbnb with a 3 percent levy on revenue from Canadian users. It would have applied retroactively, leaving US companies with a $2 billion US bill due at the end of the month.
“Rescinding the digital services tax will allow the negotiations of a new economic and security relationship with the United States to make vital progress,” Canadian Finance Minister François-Philippe Champagne said in a statement.
Trump’s announcement Friday was the latest swerve in the trade war he’s launched since taking office for a second term in January. Progress with Canada has been a roller coaster, starting with the US president poking at the nation’s northern neighbor and repeatedly suggesting it would be absorbed as a US state.
Canada and the US have been discussing easing a series of steep tariffs Trump imposed on goods from America’s neighbor.
Trump has imposed 50 percent tariffs on steel and aluminum as well as 25 percent tariffs on autos. He is also charging a 10 percent tax on imports from most countries, though he could raise rates on July 9, after the 90-day negotiating period he set would expire.
Canada and Mexico face separate tariffs of as much as 25 percent that Trump put into place under the auspices of stopping fentanyl smuggling, though some products are still protected under the 2020 US-Mexico-Canada Agreement signed during Trump’s first term.


China positions itself as force for global stability at its annual Congress

Updated 52 min 51 sec ago
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China positions itself as force for global stability at its annual Congress

  • Chinese Premier Li Qiang announced an economic growth target of 4.5 percent to 5 percent for 2026 at the start of the Congress

BEIJING: While much of the world’s attention is on the Iran war, that hasn’t stopped China from moving ahead with national priorities with global repercussions.
Not that China doesn’t care about the war and its impact on energy supplies and geopolitics. But for the world’s second largest economy, its growing rivalry with the United States revolves around a different battle: the development of the cutting-edge technologies shaping the 21st century.
That message came through in a five-year plan formally endorsed Thursday by the National People’s Congress at the end of its annual meeting, the nation’s biggest political event of the year. If anything, China is doubling down on a push to transform its economy and be at the forefront of technology. State media described China’s determination to stay the course on economic development as a force for stability in an uncertain world.
“A stable and developing China injects more stability and certainty into a world fraught with change and turbulence,” the official People’s Daily newspaper said in a front-page column on Wednesday. Other state-media echoed that view.
The commentaries and official statements didn’t mention US President Donald Trump, whose tariffs and use of military force from Venezuela to Iran are shaking up the global order that has governed international relations in the post-World War II era. China publicly defends that system, while calling for making it more equitable to reflect the interests of developing countries as well as rich ones.
Trump is due to visit Beijing in three weeks to hold talks with his counterpart, Chinese leader Xi Jinping.
The National People’s Congress also rubber-stamped three laws, including one governing ethnic minorities, at its closing session. The votes are ceremonial and nearly unanimous, designed to show unity behind the ruling Communist Party’s vision for the nation. The five-year plan was approved with 2,758 votes in favor, one against, and two abstentions.
“We are forging ahead at full speed in building a great country,” Foreign Minister Wang Yi said at an annual news conference during the Congress.
Banking on tech for growth
Many economists believe that China needs to do more to put more money into the hands of consumers to boost domestic spending and reduce its dependence on export-led growth.
China’s leaders agree in concept, but the five-year plan puts technology front and center, confirming it remains the top priority. Analysts expect any steps to boost consumption to happen only gradually, such as expanding social security and health care benefits, while government funds are poured into artificial intelligence, robotics and other areas.
Chinese Premier Li Qiang announced an economic growth target of 4.5 percent to 5 percent for 2026 at the start of the Congress, a level that gives the government more leeway to focus on the longer-term goals of the five-year plan rather than meeting a higher target this year.
Staying conservative on climate
The five-year plan doesn’t pledge to reduce carbon emissions overall, but only to reduce “emissions intensity” — how much pollutants are emitted relative to the size of the economy. That means emissions could still grow as the economy does.
The target for a reduction in intensity was set at 17 percent, a level that could allow emissions to rise 3 percent or more, analysts said. “International good practice is to move away from intensity targets toward absolute emission reduction targets,” said Niklas Hohne of the NewClimate Institute in Germany.
China has a history of setting conservative targets and its rapid expansion in solar and other clean energies may drive emissions down anyway. The country is the world’s No. 1 emitter of greenhouse gases, but leaders have long argued that the size of its population and economy must be considered when evaluating its pollution levels.
Regulating ethnic groups
A sweeping ethnic minorities law endorsed by the Congress solidifies what critics say is a government policy of assimilation, emphasizing the creation of “a common consciousness of the Chinese nation.”
The government said it is meant to foster a stronger sense of community and shared economic development among its ethnic groups. The law encapsulates an approach under Xi that has promoted unity over ethnic cultures and their languages.
“It puts a death nail in the party’s original promise of meaningful autonomy,” said James Leibold, a professor at Australia’s LaTrobe University who has studied China’s changing policies toward its ethnic minorities.
Seeking a “right to rest” for workers
Formal proposals and other suggestions to reduce work hours in a variety of ways were among those that got the most attention on social media during this year’s Congress.
Many focused on a “right to rest,” including calls to give employees the right not to respond to work messages after hours. Many Chinese workers get only five days of paid vacation a year. Yu Miaojie, an economist and deputy to the Congress, proposed raising the minimum statutory annual leave from five to 10 days.
The popularity of the proposals reflects concern about the intense workplace competition in China. Giving workers more leisure time is also seen as a way to boost consumption by giving them more free time to spend.