Trump Halts Trade Talks with Canada Over New Digital Tax

In a swift move, U.S. President Donald Trump ended trade discussions with Canada over its digital services tax targeting U.S. tech companies. The termination follows optimistic remarks from Trump's Treasury Secretary about progress in trade talks with China. Trump's decision rattles markets but aligns with his hardline tariff policies.

U.S. President Donald Trump on Friday terminated trade negotiations with Canada, reacting strongly to its digital services tax on American tech companies. Labeling it a 'blatant attack,' Trump announced plans for a new tariff on Canadian goods to be unveiled in the coming week.

Hours earlier, Treasury Secretary Scott Bessent had expressed optimism on trade advancements with countries like China, aiming to secure critical minerals for U.S. manufacturing. Financial markets fluctuated with Trump's abrupt decision, initially dipping but later recovering, with the S&P 500 and Nasdaq setting record highs.

This development precedes Canada's plan to enforce a 3% tax on digital service revenues from U.S. firms starting Monday, affecting tech giants like Amazon and Google. Meanwhile, the U.S.-China trade discourse showed progress, with resolved shipment issues of rare earth minerals, crucial for various industries.

(With inputs from agencies.)