It looks like Mark Zuckerberg is finally seeing some return for his support for U.S. President Donald Trump, though not quite in the way he would have hoped.
Today, President Trump has announced that the U.S. will cease all trade discussions with Canada in response to the Canadian government seeking to impose what amounts to unfair taxes on U.S. technology platforms, including Meta.
Well, really, primarily Meta, though the “taxes” in this case are not really new.
Back in 2023, Canadian officials introduced the “Online News Act,” which is ostensibly designed to address imbalances in the local news ecosystem, by forcing large online platforms, like Meta and Google, to pay Canadian publishers for news content that’s shared across their platforms. But both Meta and Google pushed back against the bill, saying that the proposed regulations don’t accurately reflect the state of the modern news ecosystem, but the Canadian government pushed ahead anyway, which eventually saw Meta block all Canadian news outlets in its apps.
That ban remains in place, which means that Meta’s not currently paying any of these imposed costs put in place by the bill.
In order to address this, last year, Canadian officials introduced an alternative “Digital Services Tax,” which will see digital services operating in the region that bring in more than $20 million per annum charged a 3% tax on their local earnings (above that $20m threshold). That means that Meta, even if it isn’t using local news publisher content, will still have to pay to operate in the region.
The first payments are due next week.
Which has now seemingly been brought to the attention of Trump, who’s responded with reciprocal penalties for what he sees as penalties that unfairly target U.S. tech platforms.
As per Trump (via Truth Social):
“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. They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also. Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately.”
Trump further noted that the White House will let Canada know the tariff that they’ll have to pay “to do business with the United States” within seven days.
Which is another addition to the tariffs and penalties that Trump has already imposed on Canada trade, and as such, it seems unlikely that this will have much impact on the Canadian government’s actions on this front.
But still, it does seem surprising that Trump’s only just realized that this bill exists, given that Meta blocked news in its apps in Canada almost two years ago, and that the Digital Services Tax was announced last year.
But even so, this is the exact reason why Zuck and Co. have sought to cosy up to the second Trump Administration, in order to call on the White House to push back against penalties like this, as well as regulations in Europe, which it believes unfairly focus on its business.
Indeed, over the past few years, EU regulators have fined Meta, on average, around $1 billion per year due to breaches of its increasingly complex Digital Services Act.
Zuckerberg has repeatedly criticized these penalties, noting in an interview earlier this year that:
“The EU has fined the tech companies more than $30 billion over the last, I think it was like 10 or 20 years, so when you think about it, what it really adds up to is this kind of EU-wide policy for how they want to deal with American tech. It’s almost like a tariff, and I think the US government basically gets to decide how they’re going to deal with it.”
Zuckerberg says that the American technology industry is “a bright spot in the American economy,” and as such, it’s of strategic advantage for the U.S. Government to defend that.
Which is where he’s hoping his fealty to Trump will benefit Meta, in pushing back against EU regulations specifically. And while Canada is a lesser consideration on this front, the fact that Trump is taking a stand would clearly be music to the ears of Meta’s executive team.
But will Trump be as willing to push back against EU penalties?
The Trump administration has flagged that it will take a stand. Earlier this year, for example, the chairman of the U.S. Federal Communications Commission (FCC) publicly criticized the European Union’s Digital Services Act (DSA), which he says is “incompatible with America’s free speech tradition.” Vice President JD Vance also criticized EU regulations, while Trump himself has also threatened European imports with tariffs in penalty for tech regulations that harm U.S. companies.
Though Trump has stopped short of taking specific action against European regulators as yet.
In this sense, Canada is a softer target, and one that Trump is already beating up on with other tariffs and penalties. So it’s not quite what Meta wants, but if it does end up saving the company from more penalties, and big fines from such, it could still be worth the PR hit that Zuckerberg has taken in re-aligning Meta’s approach in line with Trump’s wishes.
But it’s the EU rules that Meta really wants the White House to push back on.
And with European officials looking to impose even more fines on the company, we’ll see if Meta gets the full benefit of its new political allegiance.
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