Canada’s decision to withdraw its digital services tax over President Donald Trump’s trade threats will likely embolden the president’s strategy of using tariffs to extract broader concessions from countries.

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.

The government said on Sunday night that it would cancel its tax on American technology companies, handing a victory to the Trump administration.