Canada has halted its planned collection of a new digital services tax after President Donald Trump said that he would end negotiations on a new trade deal because of the new levy, which would affect Google, Meta, Amazon and other large tech firms.

Ottawa announced it was rescinding a tax on technology firms generating revenue from Canadians just hours before it was to take effect in an effort to move forward trade negotiations with the United States.

Over the weekend, Donald Trump claimed the tax was a "direct and blatant attack" on US tech companies and terminated the trade talks while threatening to impose a new tariff rate on Canadian goods by the 4th of July.