The Canada-U.S. trade talks collapsed on Friday night with 50 percent tariffs on billions of dollars in Canadian goods now in effect and Prime Minister Mark Carney promising dollar-for-dollar retaliation by early next month, supported by a strong sense of the need to defend Canadian sovereignty. The push for “digital trade alignment”, which I unpacked in a post last week, does not appear to have been a major source of contention, though Carney pointed to late U.S. demands on culture, autos, and sovereignty in a press conference over the weekend and the Globe reports that the inclusion of discoverability rule reforms was rejected by Canadian negotiators. But with the major outlines apparently agreed to, how can Canadians reconcile general agreement on digital policy with the government’s insistence that it would not budge on cultural protections?
Post Tagged with: "trump"
Canadian Government Caves on Digital Services Tax After Years of Dismissing the Risks of Trade Retaliation
After years of dismissing the warnings of likely retaliation, the Canadian government caved last night on the digital services tax. Faced with the prospect of the U.S. suspending trade negotiations, Finance Minister François-Philippe Champagne announced that the government would drop the DST altogether, payments scheduled for Monday would be cancelled, and legislation will be forthcoming to rescind the legislation that created it in the first place. Over the weekend, I wrote about the repeated warnings that the DST was a serious trade irritant with the U.S. that cut across party and presidential lines. While ignoring the risks was bad enough, I argued that Canada played its DST card too early. Rather than delaying implementation in the hopes of incorporating it into a broader trade deal with U.S., it marched ahead, leading to an entirely predictable response from U.S. President Donald Trump. That left Canada in a no-win situation: stick with the DST but face the prospect of higher tariffs or embarrassingly drop the DST (and $7.2 billion in revenue over five years) with only restarting negotiations that were on until government overplayed its hand to show for it.
Ignoring the Warning Signs: Why Did the Canadian Government Dismiss the Trade Risks of a Digital Services Tax?
U.S. President Donald Trump announced yesterday that he was suspending trade negotiations with Canada due to the imminent implementation of the digital services tax (DST). The result could be increased tariffs on Canadian products and a stalemate on many of the current trade battles between the two countries. This result should not come as a surprise. Indeed, the prospect of a trade war over the DST has been readily apparent for years. In my Law Bytes podcast episode in May on Canadian digital policy under Prime Minister Mark Carney, it was the top short term issue (I did not anticipate burying lawful access in a border bill).
Just prior to Trump’s inauguration in January, I wrote:
The Law Bytes Podcast, Episode 228: Kumanan Wilson on Why Canadian Health Data Requires Stronger Privacy Protection in the Trump Era
The craziness of the Trump administration relationship with Canada was on full display this past week as seemingly every day involved some form of policy change on tariffs – first on, then slightly delayed for some goods, then slightly delayed for more goods and by week’s end threats of new tariffs. Given the uncertainty, I recently co-wrote an op-ed in the Globe and Mail together with Dr. Kumanan Wilson that sought to put the spotlight on another issue that could come to the fore if the economic battle moves beyond tariffs to other issues. In this case – privacy, data localization and health data.
Dr. Wilson is a specialist in General Internal Medicine at The Ottawa Hospital, Chief Executive Officer/Chief Scientific Officer, Bruyère Research Institute, a Professor and Faculty of Medicine Clinical Research Chair in Digital Health Innovation at the University of Ottawa and member of the University of Ottawa’s Centre for Health Law, Policy and Ethics. He joins the Law Bytes podcast to discuss why we should be paying attention to health privacy, AI and the location of our data.
Canadian Health Data Requires Stronger Safeguards With Lost Canada-U.S. Trust
With today’s implementation of tariffs on both sides of the Canada-U.S. border, the level of mistrust between our countries has grown, whether urgent calls to “Buy Canadian” or boos and catcalls at the playing of the American national anthem. Should we continue down this path, Mr. Trump will surely seek to exploit more of Canada’s potential vulnerabilities. Last week, I co-wrote an op-ed with Kumanan Wilson on one such vulnerability: our health data, whose protection has yet to attract much attention but which could emerge as an issue.
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