Pakistan, June 30 -- OTTAWA - In a last-minute move, Canada scrapped its planned digital services tax targeting American tech companies just hours before it was set to take effect. The decision aims to ease tensions with the United States and revive stalled trade negotiations between the two countries.

The 3% tax would have applied to digital revenues earned from Canadian users by large tech firms making over $20 million annually, retroactive to 2022. It was expected to impact major US companies like Amazon, Google, Meta, and Apple.

US President Donald Trump had fiercely opposed the tax, calling it a "blatant attack" on American businesses. After abruptly halting trade talks last week, he warned on Sunday of possible new tariffs on Cana...