Here's the main verse for discussion:
Qur’an 9:29—Fight those who believe not in Allah nor the Last Day, nor hold that forbidden which hath been forbidden by Allah and His Messenger, nor acknowledge the Religion of Truth, from among the People of the Book, until they pay the Jizyah with willing submission, and feel themselves subdued.
On a related note, here's a complete analysis of the historical, immediate, and extended literary contexts of 9:29. For some reason, Shaikh goes to the opening verses of Surah 9 (which are part of a discussion of Islam's dealings with pagans) to establish the context of 9:29 (which is a discussion of Islam's dealings with Christians and Jews). Unfortunately for Shaikh, the Muslim sources are very clear on the meaning of 9:29: