The White House on Monday said that Canadian Prime Minister Mark Carney had “caved” to pressure from US President Donald Trump, after Canada withdrew a controversial tax targeting American tech companies, a move that had triggered a freeze in trade talks.White House press secretary Karoline Leavitt told reporters, “It’s very simple. Prime Minister Carney and Canada caved to President Trump and the United States of America.” She added that Trump “knows how to negotiate,” and that “every country on the planet needs to have good trade relationships with the United States.”The dispute stemmed from Canada’s digital services tax, enacted last year, which would have required major US tech firms like Alphabet and Amazon to make multi-billion-dollar payments by Monday. In response, Trump abruptly called off trade talks with Ottawa last Friday, retaliating against what he called an unfair levy.Canada, on late Sunday, announced that it was rolling back the tax and would resume trade negotiations with Washington. The escalation came despite a recent thaw in relations between Trump and Carney. The two leaders held a meeting at the White House on May 6 and again at the G7 summit earlier this month, where global leaders urged Trump to ease his confrontational stance on trade.However, tensions flared again over the weekend when Trump revived his rhetoric that Canada should become the 51st state of the United States. “Frankly, Canada should be the 51st state, okay? It really should, because Canada relies entirely on the United States. We don’t rely on Canada,” Trump told Fox News’ Sunday Morning Futures. Leavitt defended the administration’s tough approach, warning that countries still resisting US trade demands could face consequences. “He is going to set the rates for many of these countries if they don’t come to the table to negotiate in good faith, and he is meeting with his trade team this week to do that,” she said, referring to Trump’s looming July 9 deadline for new trade deals
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