Business Rundown: President Trump Scores Win In U.S.-Canada Trade Talks
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Monday, June 30th, 2025. Days ago, President Trump said he would suspend trade talks with Canada, calling their plan to tax U.S. tech companies a blatant attack on our country. By Sunday night, Canada would have been in a state of shock.

Canada had changed their tune, agreeing to resend their digital services tax to help reach a trade deal with the U.S. by July 21st. So Trump basically said, I'm walking away because of this tax. And the Canadians said, OK, we're going to get rid of the tax. So pretty remarkable stroke by the president. In anticipation of a trade deal, Canadian Prime Minister Mark Carney said his country would resend a digital services tax on American tech companies.

This was a tax that took place last June requiring big tech firms to pay 3% tax on revenue earned from engaging with users and candidates.

It was on Friday that the president rallied against this tax as unfair, saying Canada was copying the European Union in its crackdown on strong American tech companies like Amazon, Meta, Apple and more. By tossing Canada's digital tax, trade talks have reportedly resumed, giving investors even more tailwind and boosting Wall Street futures to reach record highs on Monday.

Trade talk optimism isn't the only factor fueling this. The Senate looks to pass the president's ambitious tax and spending package by the end of the week. The bill would extend much of the 2017 tax cuts and jobs act, but also include some new tax cuts for Americans like no tax on tips and no taxes on overtime pay.

But first, we'll start with that big news Sunday night that Canada had accommodated President Trump's demands and trade talks between these nations have resumed. Well, it's pretty remarkable. I mean, this happened over the weekend. President Trump terminated the trade discussions on Friday. And one of the things that he cited was this digital services tax issue.

that is paid by American tech companies. - Jonathan Honig is a Fox Business contributor and founding member of the capitalist pig hedge fund. - You know, companies like Amazon and Meta. And you know, this was something that was in Canada for quite a while. It actually started in June of 2024 and requires businesses wherever they're headquartered, in Canada, doesn't matter, to basically pay a 3% tax. So Trump said, "I don't like that." He terminated tax, those discussions.

Now, turn around now, Monday morning, and Canadian Prime Minister Mark Carney said that they will rescind that tax.

So Trump basically said, I'm walking away because of this tax. And the Canadians said, OK, we're going to get rid of the tax. So pretty remarkable stroke by the president. But when you consider, Jerry, how much business happens between these two countries, the U.S. is Canada's largest trading partner. You know, you'd like to hope that some sort of semblance of some sort of agreement can be reached.

I read that 78% of Canadian goods come to the U.S. Imagine that. Nearly 80% of goods are sold here. They desperately need us. We are a big marketplace, especially for their oil and also auto production.

Oil, auto production, yeah, and also steel and aluminum, you know, big producers in Canada as well. So, you know, this is an important relationship for businesses in America and consumers, big and small. But it is important, the relationship we have with Canada, I think. I guess I'm married to a Canadian, so this is...

This is something I understand firsthand just a little bit. They are on our border. We need them to be friendly. But I think that we can preserve that relationship while also getting a trade deal that is in our favor. Do you agree?

Yeah, I mean, I think it really comes down to the details. Some things are very seemingly provincial in Canada, like dairy, for example. They've had extraordinary high tariffs to protect their dairy industry for quite some time. So, you know, given the proximity of these two countries, the history, the

friendly relationships, you'd like to think that the president and his team can find some deal to come with the Canadians so that businesses can trade. And that's good for, of course, both. You know, trade is always win-win. So I think the sooner the president could come to some sort of a deal, the better for everyone involved.

I think people don't really understand just how complicated these trade conversations are and how deeply embedded some of these trade issues that are at the U.S.'s disadvantage are embedded in policy. For example, in Canada, you mentioned milk products, dairy. There are certain things that we include in our milk and dairy products that Canada does not allow in the country, and that is a de facto block of

on us selling dairy in that country. There's a lot to untangle here. It's going to be interesting to see what this looks like five years from now, but let's take a broader view here. You know, every time we get a positive signal on trade talks, the market goes higher, and that's certainly what we've been seeing today. Should we expect tech stocks to soar today? Do you see this rally broadening out? What is your expectations in the marketplace?

Really, tech stocks have had an unbelievable, miraculous comeback, Jerry. I mean, names like Nvidia since those April lows up more than 50%, really remarkable. But it had been up until the last couple of weeks, a broadening rally. You had seen international stocks do pretty well. Small and mid-cap started to participate in addition. So the market rally had been broadening, but it's all about large cap tech assets.

as of late. But when you think about it, it's not really too surprising. I mean, these big tech companies are-- you can't almost live your life without them. Think about how much they've changed and how much they've improved our lives and how much they've had to improve their own businesses. I mean, when Amazon started, it was an online bookseller. Of course, it does so much more. Or companies like Google have pioneered advanced technologies. So in America, there's no such thing as a monopoly. So the big tech companies are succeeding

because they're innovating and that's why they've been on top of the market

the markets as well. And that's why you saw countries like Canada instituting a digital services tax because they wanted to get part of that take, which is impressive. Let's talk about what we're seeing this week. What are you watching in the markets that might impact where they're going? You know, we saw highs last week. We've got Middle East stability. It seems like a lot of things are going in the right direction. What news events or potential news events or economic data are you watching this week?

Well, certainly into the big, beautiful bill. There's some elements to like about this, Jerry. The bill reduces the corporate tax rate that creates jobs, that raises wages. It also lowers a lot of individual income tax rates. So some positive elements of that. But there's also the question of the debt and the deficit. I mean, the big, beautiful bill does increase the tax

the deficit somewhere on to $3.3 trillion. So we'r close eye on inflation. Yo the feds target. It's co last couple of months a consumers are, they're b still feeling the heat. S on the table these days, tariffs and it's inflati

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Let's talk a little bit more about that big, beautiful bill. We've talked about tax cuts. The president today saying, I believe that, yeah, without passing this bill, there would be a 68 percent, he says, tax increase on Americans. What do you see the impact of these tax cuts? If they were not to be extended, what would be the impact on Americans and the economy?

Well, a tax tax hikes hurt Americans. Higher taxes is more money out of the actual economy, you know, in the hands of bureaucrats. So, you know, there's no question that, you know, tax cuts are a positive thing. What's also positive, however, are spending cuts. And that's what's a lot of what's missing from the big, beautiful bill. So the deficit hawks, the the

you know, have voiced their opposition to that for that reason. But, you know, there's no question, Jerry, where does wealth come from? Does it come from government spending? No, just the contrary. It comes from private investment, private innovation, private capitalism. And that's what you see. And that's what you get when you have tax cuts and you have low, flat, easy to understand taxes. We could have this in this country if we had the political will.

I have to ask you a bonus question because I'm just curious about what you think because I know you'll be very opinionated about it.

Young man in New York City running for the seat of mayor, Mamdami. He is a self-proclaimed socialist. He is doing very well with – especially with wealthy people in New York City, strangely. What do you make of his emergence as the likely – he's the candidate, but he could well win the New York mayoralty? Well, I mean this is a –

it's a function of our era, Jerry. I mean, we live in an era, an era in which, you know, capitalism is seen as evil. You know, capitalists are colonizers, they're racist, they're dangerous to the environment. They're, you know, uh, dis, uh,

mean to their employees and socialists for some reason are seen as these, oh, benevolent, kind, you know, pacifist, environmental friendly. So, you know, socialism has kind of a, it's been taught as being morally right. It's been taught as being morally just. And I think that's a lot of what has, you know, the wind of this young man's back, you know, capitalism is seen as being harsh, as being mean, as being cruel.

And, you know, I think that's why for so many young people, it's almost a dirty word. And do you want to push back on that idea? Oh, sure. We need to push back on it. I mean, capitalism is freedom. Without economic freedom, you're not free at all. So when this young man says, you know, he wishes he was in a world without billionaires, you know, we...

We owe billionaires everything. I mean, you know, would we be better off if Jeff Bezos wasn't a billionaire and we didn't have something like Amazon.com, which was a tremendous value to, you know, hundreds and hundreds of millions of Americans? So in a capitalist economy, people,

earn their money. They certainly do here in America. And that really is the exciting beauty of America, Jerry. This is a place where anyone can make it. Come to this country, work your tail off and become successful. That's the American dream. It's not dead. But unfortunately, so many politicians, I think, want to put it in a way early grade. Well, you can build it yourself here. That's for darn sure. And that's very exciting. Jonathan Honig, thank you so much. Always great to talk with you. My pleasure. Thank you.

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