President Donald Trump threatened U.S.-Canada trade talks on Friday over the northern nation's digital services tax, which required foreign and domestic large businesses such as Netflix, Amazon.com's Prime Video, and Spotify to pay a levy of 3% on revenue earned from offering online services to users in Canada.
"We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country," Trump noted in a Truth Social post.
"They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also," continued the president. "Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately."
'Canada is a very tough country to deal with.'
Canada — the top buyer of American goods, importing $349.4 billion last year, and 75.9% of whose total exports went to the U.S. — made abundantly clear that it wasn't too attached to the tax, which the Parliamentary Budget Office estimated would increase federal government revenues by over $5.2 billion over five years.
Within hours of Trump's post, the Department of Finance Canada announced that it was rescinding the digital services tax to advance broader trade negotiations with the United States.
Canadian Finance Minister François-Philippe Champagne noted that "rescinding the DST will allow the negotiations to make vital progress and reinforce our work to create jobs and build prosperity for all Canadians."
U.S. Commerce Secretary Howard Lutnick thanked Canada on Monday for removing the tax, noting that it was "intended to stifle American innovation and would have been a deal breaker for any trade deal with America."
RELATED: Canada's solution to reliance on US? Increasing commitments in Europe
"In our negotiations on a new economic and security relationship between Canada and the United States, Canada's new government will always be guided by the overall contribution of any possible agreement to the best interests of Canadian workers and businesses," said Canadian Prime Minister Mark Carney. "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."
The Canadian Liberal Party under former Prime Minister Justin Trudeau first promised the tax ahead of the 2019 federal election, saying it would "make sure that multinational tech giants pay corporate tax on the revenue they generate in Canada," even though critics indicated that Canadian consumers would end up paying the taxes.
The Digital Services Tax Act went into force on June 28, 2024, prompting condemnation stateside as well as an official complaint under the Canada-U.S.-Mexico Agreement from former U.S. Trade Representative Katherine Tai.
John Dickerman, vice president of the Washington, D.C.-based Business Council of Canada, suggested to Canadian state media days after Trump's re-election that the tax was likely doomed.
"The first Trump administration ... was very clear on digital services taxes. They believed that digital services taxes were a very clear indication that a country was specifically targeting the U.S. and targeting U.S. companies. It will be a 'with us and against us' scenario," said Dickerman. "I think there will be very little room for negotiation on DST."
Trump leaned on Canada to axe the tax just in the nick of time. The first payments were due on Monday and retroactive to 2022, meaning a number of American corporations were on the hook for billions of dollars.
The Canadian government indicated that Carney and Trump have agreed to resume negotiations "with a view towards agreeing on a deal by July 21, 2025."
"Canada is a very tough country to deal with, I will say that," Trump told Fox News' "Sunday Morning Futures." "Hopefully we'll be fine with Canada. I love Canada. Frankly, Canada should be the 51st state."
Blaze News has reached out to the White House for comment.
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President Donald Trump signed a memo Tuesday directing his administration to ensure that illegal aliens are not receiving taxpayer funds from Social Security Act programs, including Old-Age and Survivors Insurance, unemployment insurance, disability insurance, Medicare, Medicaid, and Temporary Assistance for Needy Families.
The initiative appears to be aimed both at eliminating the monetary incentive for foreign nationals to steal into the homeland and at pressuring the noncitizen net-takers already here to either wean off the dole or hit the road.
The memo directs the Social Security Administration to: expand its fraud prosecutor programs to at least 50 U.S. attorney offices; establish a Medicare and Medicaid fraud prosecution program in 15 U.S. attorney offices; investigate earning reports of individuals supposedly 100 years or older with mismatched records; consider reinstating its civil monetary penalty program; and reinforce program integrity measures so only those foreign nationals who satisfy all eligibility requirements can receive benefits.
'This literally blew us away.'
In a fact sheet detailing the memo, the White House echoed Elon Musk's recent revelation that over two million illegal aliens were apparently assigned Social Security numbers in fiscal year 2024 alone.
Venture capitalist Antonio Gracias, who has been working with the Department of Government Efficiency in scrutinizing the SSA, noted at the Wisconsin town hall where Musk highlighted the provision of Social Security numbers to illegal aliens, "This literally blew us away," reported NewsNation.
"We went there to find fraud, and we found this by accident," said Gracias.
Migrants authorized to legally work in the U.S. are eligible to apply for a Social Security Card — but in order to receive Supplemental Security Income, the Department of Homeland Security must class them as a migrant legally admitted and conferred permanent residency, a migrant granted conditional entry or asylum, or a migrant paroled into the country or admitted as a refugee.
Gracias suggested that in recent years, migrants were given SSNs automatically through the mail without an interview or showing identification.
The White House fact sheet notes that the multitudes of illegal aliens who entered the U.S. under the Biden administration are "siphoning dollars and essential services from American citizens while state and local budgets grow increasingly strained."
The Center for Immigration Studies revealed in a December 2023 report that 54% of households headed by immigrants, including naturalized citizens, legal residents, and illegal aliens, used one or more major welfare program.
'These taxpayer-funded benefits should be only for eligible taxpayers.'
The study indicated that 48% of "illegal-headed households" used food welfare programs; 39% relied on Medicaid; 18% relied on cash welfare; and 4% relied on housing programs.
The House Committee on Homeland Security noted in a November 2023 report that the cost in federal welfare for every one million parolees released into the U.S. under the Biden administration was likely in the neighborhood of $3 billion annually.
As of 2022, American taxpayers were shelling out at least $182 billion annually to provide services and benefits to illegal aliens and their dependents, according to the Federation for American Immigration Reform report cited in the White House's fact sheet. FAIR indicated that net cost is $150.7 billion if the estimated $31 billion taxes illegal aliens cough up are factored.
The White House noted that the $182 billion figure includes $66.4 billion in federal expenses and $115.6 billion in state and local expenses. Again citing FAIR estimates, the White House noted that "a million illegal aliens hold stolen identifications or fraudulent SSNs" — abuse that has long been widespread.
White House press secretary Karoline Leavitt told reporters Tuesday, "These taxpayer-funded benefits should be only for eligible taxpayers."
"President Biden should think about what he did in his last term, which is allow tens of millions of illegal people into our country, many of whom were fraudulently receiving these benefits."
The Social Security Administration indicated that Trump's memorandum "reinforces SSA's commitment to safeguarding taxpayer dollars and ensuring the integrity of the programs it administers."
"The Social Security Administration is dedicated to protecting the vital benefits that American workers have earned on behalf of themselves and their families," said acting SSA Commissioner Leland Dudek. "We are committed to working diligently to implement the President's memorandum and to ensure that benefits are paid only to those who should receive them."
Martin O'Malley, the SSA commissioner during Joe Biden's final year in office, told Government Executive, "This is all on brand for them, because they enjoy inflicting cruelty on people in the name of going after immigrants."
"If they go forward with this representative payee plan, they are talking about interrupting benefits that are legally owed to Americans and American-born children here in the U.S.," said O'Malley. "Just because someone might not have proof of their legal status on an SSA record doesn’t mean they aren’t the representative payee for a U.S. citizen, whether it be their husband with a disability, a mother-in-law, an American-born child."
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Republican Mississippi Gov. Tate Reeves ratified legislation Thursday eliminating the individual income tax in his state by 2037 through annual decreases. The bill also decreases the tax on grocery sales from 7% to 5% and raises the gas tax by 9 cents over three years.
"Mississippi will no longer tax the work, the earnings, or the ambition of its people," the governor said in a statement. "The legislation I'm signing today puts us in a rare class of elite, competitive states. There are only a handful of states in the country that do not tax income. Today, Mississippi joins their ranks — and in doing so, we plant our flag."
Up until now, Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming were the standout states that refused to confiscate wealth from Americans in the form of income taxes. While New Hampshire still taxes investment and interest income, it is presently in the process of phasing those out.
Mississippi House Bill 1, the "Build Up Mississippi Act," will reduce the income tax from 4% to 3.75% in 2027 then down to 3.5% in 2028, 3.25% in 2029, and 3% in 2030. There will be annual decreases in the following years until the income tax falls to 0%.
'This is a transformation.'
House Minority Leader Robert Johnson III (D) suggested that a typo in the trigger language of the act may, however, actually move up the time schedule for abolishing the income tax, reported WJTV-TV.
"The trigger is actually no longer a trigger because at the 80/500 of a percent, we essentially are in tax cut mode right now," said Johnson, who voted against the bill.
The Mississippi Free Press reported that lawmakers were under the impression that the tax would be further reduced in 2031 if the state's surplus in revenue from the previous fiscal year was greater than 85% of $407 million. The legislation as enacted instead states that the reduction will be triggered if the state's surplus that year is greater than 0.85% of $407 million.
Mississippi House Speaker Jason White (R) noted that one way or another, the legislation "eliminates the income tax in as soon as 14 years. While that's not fast enough for some, the House plan was a little faster than that — 11 years."
When the Mississippi legislature passed HB1 by a vote of 92-27 on March 20 — where all opposed were Democratic lawmakers — National Federation of Independent Business director Leah Long stated, "This is great news for Main Street businesses."
'Government should take less so that you can keep more.'
"Most small businesses in the state are structured as pass-through entities, meaning the revenue passes through the business to the owners, who pay taxes at the individual rate," said Long. "Eliminating the state income tax will allow small business owners to reinvest more revenue into their businesses, create jobs, and support their communities."
The Republican Governors Association called the ratification of HB1 a "historic achievement."
"This is more than a policy victory," said Reeves. "This is a transformation. And it's a transformation that I have believed in, fought for, and worked toward for many years."
"I believe in a simple idea: that government should take less so that you can keep more. That our people should be rewarded for hard work, not punished. And that Mississippi has the potential to be a magnet for opportunity, for investment, for talent — and for families looking to build a better life," added the governor.
While Reeves and other Republicans suspect that the elimination of the tax will lure talent and investment to the state, some critics claim Mississippi's prosperity might be at stake.
Kyra Roby, the policy director of the leftist activist outfit One Voice, noted in a recent op-ed that the loss of the $2.1 billion that Mississippi's income tax nets the state annually "would severely impact funding for education, healthcare, roads, and other vital services."
Roby also complained that the tax cut would save wealthier people more money, claiming that "disparities could worsen."
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Colorado Democrats are more than willing to blow taxpayer money on programs for illegal aliens; however, when it comes to coverage for American mothers and their unborn babies, they will apparently appeal to lethal ways to reduce spending.
State Democrats are advancing legislation that would enshrine the right to abortion in the state constitution; require the Colorado Department of Health Care Policy and Financing to fund abortions for Medicaid and Child Health Plan Plus program participants using taxpayer dollars; and force public employee insurance plans to fund abortions for plan members — something they are not presently required to do.
Senate Bill 183 — a consequence of Colorado voters' overwhelming support last year for Colorado Amendment 79, which set the stage for the use of public funds for abortion — passed the state Senate in a 22-12 party-line vote on March 12.
Prior to the bill passing the committee on health and human services on Tuesday, Colorado House Speaker Julie McCluskie (D), a prime sponsor of the legislation, indicated that the use of taxpayer funds to kill babies could save the state a little bit of money.
"That savings comes from the averted births that will not occur because abortions happened instead," McCluskie said in a video shared to social media. "So a birth is more expensive than an abortion — so the saving comes in Medicaid births that will not occur."
"This bill will actually decrease costs for our health care policy and financing department, our Medicaid expenditures, in both this year and out years as the savings from averted births outweigh the costs of covering reproductive health care for all Coloradans," continued McCluskie, who was endorsed last year by Planned Parenthood.
'Abortion care services represent a one-time expenditure.'
While the Colorado House speaker indicated the state will initially see an "increase to general fund of $1.5 million," over time, the taxpayer-subsidized elimination of human life will ultimately lead to "cost savings."
McCluskie was referencing a state fiscal analysis that made the following assumptions and assertions:
According to Democrats' calculus, abortions will not only save the state on total reimbursement costs for the delivery of children but will likely also spare the state from having to deal with additional costs that might arise in relation to human beings whose lives they failed to "avert."
"Medicaid-covered births typically involve additional social safety net impacts for the child, whereas abortion care services represent a one-time expenditure. These impacts have not been addressed in this fiscal note," said the fiscal note on SB 183.
"On net, the bill will decrease costs for HCPF by about $286,000 in FY 2025-26 and $573,000 in FY 2026-27 and ongoing," continued the fiscal note. "These impacts are the net result of increased costs for abortion services and decreased costs from averted births."
State Rep. Kenneth G. DeGraaf (R) tweeted, "Holy Human-Haters, Batman! 'Killing people is less expensive than caring for them' coming soon from a eugenicist near you."
"Paying for abortions for low income women will save our state millions of dollars on 'averted births,'" wrote Republican state Rep. Brandi Bradley. "Margaret Sanger would be so proud."
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The Department of Government Efficiency has managed in just a few weeks to inspire dread among various contributors to and beneficiaries of government waste.
After making its penetrating gaze felt at over a dozen federal agencies, including the U.S. Agency for International Development, the Consumer Financial Protection Bureau, and the Federal Emergency Management Agency, the DOGE set its sights on the Internal Revenue Service.
Sure enough, bureaucrats at the organization that the Obama administration weaponized against conservatives have begun to panic.
Two unnamed sources said to be familiar with the matter told Reuters that one of Elon Musk's top DOGE staffers, Gavin Kliger, arrived at the IRS Thursday to scrutinize the agency's operations. Kliger reportedly met with top executives at the agency who were separately instructed in an email to identify all "non-essential" contracts for termination.
"Consistent with the goals and directives of the Trump administration to eliminate waste, reduce spending, and increase efficiency, GSA [General Services Administration] has taken the first steps in a government-wide initiative to eliminate non-essential consulting contracts," said the email.
According to CNN, Kliger apparently asked for a description of what each business unit in the agency did, what it sought to accomplish in the next 90 days, and what risks it currently faces. Despite the straightforward nature of the DOGE member's questions, Kliger's visit reportedly left IRS staffers on edge.
IRS staffers were apparently not the only ones in Washington, D.C., concerned over the prospect of greater transparency and improved efficiency.
'It's poetic justice.'
Democratic Sen. Ron Wyden of Oregon rushed to concern-monger on X, writing, "My office is hearing that DOGE is now at the IRS. That means Musk's henchmen are in a position to dig through a trove of data about every taxpayer in America. And if your refund is delayed, they could very well be the reason."
When asked about Kliger and other DOGE officials' visit to the IRS, President Donald Trump told reporters, "They're doing a hell of a job. It's an amazing job they're doing."
"Their force is building. I call it the force of super-geniuses," said Trump. "They go up and they talk to some of the people about certain deals, and the people get all tongue-tied. They can't talk because these people get it. They're very smart people."
Trump suggested that he does not plan to shutter the IRS but noted that the agency "will be looked at like everybody else."
Christian Whiton, a senior adviser in the first Trump administration, told Sky News, "It's poetic justice for the IRS to be facing scrutiny since they scrutinize the rest of us."
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Sen. Josh Hawley (R-Mo.) appears eager for the GOP to adopt more pro-natalist policies, making family generation less daunting and child-rearing more affordable amid an apparent population collapse.
Hawley's proposed Parent Tax Credit Act, which would have made parents of children under the age of 13 eligible for an individual tax credit of $6,000 or a joint credit of $12,000, died in the 117th Congress. In the wake of President-elect Donald Trump's landslide victory and the approaching Republican trifecta in Washington, D.C., Hawley appears keen to try once again to give those families raising the next generation of Americans a break.
"President Trump won with the support of working people with kids," Hawley wrote on X Monday. "Next year's tax bill should provide them a big tax cut."
'Make it easier to choose life in the first place.'
Axios reported that the Missouri senator is calling for the child tax credit to be raised from a maximum of $2,000 to $5,000 per kid. Following the birth of a child, parents would be able to claim a credit for the tax year of the pregnancy.
Under the proposal, which would have the credit applied to payroll taxes, families could opt to receive the tax credits in installments throughout the year rather than as a lump sum. While conditional on the parents' having jobs and paying taxes, families would not need to clear the $2,500 income minimum to begin accessing the credit.
Hawley told Axios that the proposed boost conforms with what Vice President-elect JD Vance recommended earlier this year.
Vance told CBS News' Margaret Brennan in August, "What President Trump and I want to do on family policy is make it easier for families to start in the first place. We want to bring down housing costs so that if you have a baby, there's actually a place to raise that baby."
"We want to increase and expand the child tax credit. We want to make it easier for moms and dads to not be shocked by these surprise medical bills when they go to an out-of-network provider," continued Vance. "We're working on all this stuff, and I think that's ultimately how we turn down the temperature a little bit, is to make it easier to choose life in the first place."
When pressed for the particulars of the child tax credit, Vance told Brennan that he would "love to see a child tax credit that's $5,000 per child."
Bloomberg reported that an increase of the tax credit to $5,000 could cost over $2 trillion over the next 10 years.
Trump's 2017 Tax Cuts and Jobs Act doubled the child tax credit from $1,000 to $2,000 and made it available to more middle-income families.
The child tax credit was temporarily expanded during the pandemic to $3,000 or $3,600, depending on the age of the child. Families who failed to file income taxes were similarly enabled to access the credit.
Following the demise of the pandemic boost, in a 357-70 January vote, the House passed legislation aimed at enhancing child tax credit eligibility for poor families.
The legislation was, however, killed by Republicans in the Senate, some of whom regarded the vote on the legislation as a "show vote" and others who suspected the bill would have transformed the CTC into a handout for families not paying much or any tax. Sen. Mike Crapo (R-Idaho) indicated that the bill "isn't tax relief — it's a subsidy."
Hawley was among the three Republicans who voted in support of the tax package.
House Republicans have recently sounded the alarm that with the 2017 Trump tax cuts set to expire next year, the child tax credit could be slashed in half.
"Raising a family can be challenging enough without Washington pulling the rug out from under parents. But that’s exactly what will happen if the 2017 Trump tax cuts are allowed to expire next year. Forty million families will see their Child Tax Credit — a pro-family policy that was created, and later doubled, by Republicans to provide families relief and support — slashed in half," Ways and Means Committee Chairman Jason Smith (R-Mo.) stated last week. "Congress must act as soon as possible to eliminate this threat of a higher tax burden and give families peace of mind."
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As Election Day approaches, former President Donald Trump told voters that he believes he could pave the way for the elimination of federal income taxes.
On Monday, Trump participated in a town hall segment with Fox News at a barbershop in the Bronx, where he answered questions from the business' owner, employees, and patrons.
'There is a way if what I'm planning comes out.'
One individual told Trump that his biggest concern is that his two children and future generations will not be able to obtain the American dream because of oppressive over-taxation.
"When it comes to federal taxes, I'm sure you're going to start back up the pipeline, the Keystone Pipeline, which is going to generate an abundance of revenue. Also, with the tariffs that you've spoken of," he told Trump.
He asked, "With all this extra revenue that we're going to be bringing into the country, do you believe that at some point in time, we could find a way — once the country's back on its feet and getting enough revenue and pays off our debt — do you think it's possible to find a way to eliminate federal taxes?"
Trump replied emphatically, "There is a way."
He stated that in the 1890s, the United States relied on tariffs and did not have a federal income tax.
"Now we have income taxes, and we have people that are dying, they're paying tax, and they don't have the money to pay the tax," Trump continued. "In the old days, 1890, 1880, we had so much money they had to set up committees, blue-ribbon committees, how to spend our wealth. We had no idea how to spend it; it was so much money. Then we went to the income tax system, and the rest is sort of history."
"No, there is a way if what I'm planning comes out," Trump added.
The former president has already stated that he supports abolishing the federal income tax on tips, overtime pay, and Social Security.
The United States, for the first time, briefly imposed a 3%-5 income tax from 1862 to 1872 to cover the cost of the Civil War.
W. Elliot Brownlee, a historian of tax policy at the University of California, Santa Barbara, told the New York Times that the U.S. adopted "a mass-based income tax for the first time during World War II."
From 1868 to 1913, approximately 90% of all revenue was generated from liquor, beer, wine, and tobacco taxes. Currently, income taxes generate 94% of the federal government's revenue, while tariffs make up just 2%.
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President Donald Trump vowed at his rally in Tuscon, Arizona, Thursday that he would eliminate all taxes on overtime pay — an unprecedented proposal from the federal government. This is part of a broader raft of proposed tax cuts, one of which is apparently so popular as to drive Kamala Harris to adopt it as her own.
"We will end all taxes on overtime," said Trump. "You know what that means? Think about it."
Trump suggested not only that Americans would have a greater incentive to work more if they knew the government wasn't skimming off the top but that businesses would have a easier time with recruitment and retention.
'It's time for the working man and woman to finally catch a break.'
"The people who work overtime are among the hardest-working citizens in our country. And for too long, no one in Washington has been looking out for them," continued Trump. "They're police officers, nurses, factory workers, construction workers, truck drivers, and machine operators. It's time for the working man and woman to finally catch a break."
The Labor Department under Trump issued a rule in 2019 making overtime pay available to an additional 1.3 million workers. It did so by raising the salary level that companies would have to pay in order to avoid paying workers at least 1.5 times their regular pay rate for work in excess of 40 hours a week.
Even though millions of Americans benefited, supposed labor activists, Democrats, and the liberal media criticized Trump's salary-level increase, suggesting it was not as generous as one of President Barack Obama's failed schemes.
Piggybacking on the success of Trump's rule, the Biden administration announced a final rule in April further increasing the salary threshold required to exempt workers from federal overtime pay requirements — from $36,568 to $43,888 by July 1, 2024, and to $58,656 by Jan. 1, 2025.
As a result of the 2019 and 2024 threshold increases, a great many Americans would be able to avoid forking over their hard-won overtime earnings to the government under Trump's proposed tax policy.
Reuters noted that while this proposal is a first from the federal government, Alabama paved the way this year, becoming the first state in the union to exclude overtime wages for hourly workers from state taxes. The move is, however, temporary.
According to the Tax Foundation, which has been tracking proposed tax policies on the campaign trail, Trump has said he would also:
It appears the Harris campaign did not take Trump's announcement well.
A Harris campaign spokesman said, "He is desperate and scrambling and saying whatever it takes to try to trick people into voting for him."
It is unclear whether Harris, who was recently exposed copying and pasting policies from her former running mate, will also claim this proposal for her own.
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There's no question Trump's economic policies are better than Harris', but if he wins the election, these are areas he should reconsider.
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