Canadian Prime Minister Mark Carney says trade talks with U.S. have resumed after Canada rescinded its plan to tax U.S. technology firms.

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.

Ottawa announced it was rescinding a tax on technology firms generating revenue from Canadians just hours before it was to take effect in an effort to move forward trade negotiations with the United States.