Canadian Premier shares statement in major U-turn after slapping huge tax increase on electricity for Americans

A Canadian Premier has seemingly had a change of heart after threatening to slap a huge levy on electricity to the homes and businesses of 1.5 million American citizens.

Premier of Ontario, Doug Ford, has been on the frontlines in the escalating trade war between the US and Canada.

It all started when President Donald Trump signed off on a slew of 'catastrophic' tariffs to the US' neighbors - citing reasons from drugs to immigration as justification for the sanctions - and said the only way Canada would be liberated from the tax hikes would be to join the US as its 51st state.

To this end, Trump has been taunting former Prime Minister Justin Trudeau by giving him the nickname 'Governor of Canada,' but officials in the North American country have hit back by claiming Canada would inflict counter-tariffs on US goods.

Meanwhile, Premier Ford tore up a $100 million contract with Elon Musk in an apparent retaliation and this week has threatened not only to hike mineral exports but to impose a 25 percent surcharge on electricity that powers the homes and businesses of 1.5 million people in New York, Michigan and Minnesota.

He even warned he would flip the switch off entirely if Trump continues to 'escalate' matters.

However, now that Trump has rolled out a 25 percent hike on aluminum and steel starting today (March 12) and threatened to double it to 50 percent for Canada, it appears Ontario is backing down, at least momentarily.

Doug Ford has slammed the brakes on the electricity tariff (Katherine KY Cheng/Getty Images)

In a joint statement between Ford and US commerce secretary, Howard Lutnick, the pair said they had a 'productive conversation' about their economic relations and plan on meeting tomorrow (March 13) to discuss renewing the US-Mexico-Canada free trade act ahead of Trump's reciprocal tariff deadline on April 2.

"In response, Ontario agreed to suspend its 25 per cent surcharge on exports of electricity to Michigan, New York and Minnesota," Ford's statement on Twitter added.

Trump has also pressed the pause button and called Ford a 'strong man' amid the tense stand off.

The POTUS said to reporters: "As you know, there's a very strong man in Canada who said he was going to charge a surcharge or a tariff on electricity coming into our country.

"He has called, and he said he's not going to do that," Trump continued. "He's not going to do that. And it would've been a very bad thing if he did and he's not going to, so I respect that."

Just hours before slamming on the brakes, Ford apologized to ordinary Americans that would be affected by the Canadian tariffs as he vowed 'relentless' counterattacks.

The POTUS has welcomed Canada's U-turn on the surcharge (Alex Wong/Getty Images)

He estimated the 25 percent hike on electricity would rake in $400,000 dollars every day, adding around $1,200 to the annual electric bill of 'hardworking Americans'.

"If the United States escalates, I will not hesitate to shut the electricity off completely," he continued. "Believe me when I say I do not want to do this, I feel terrible for the American people, because it's not the American people who started this trade war.

"It's one person who's responsible. That's President Trump."

In an interview with Fox Business, Ford reiterated: "Isn’t this a shame. It’s an absolute mess... he's created chaos."

Incoming Canadian Prime Minister Mark Carney has also pledged to confront the trade war, saying that the taxes present the 'greatest crisis in our lifetime' for Canadians.