Canada Implements 3% Digital Services Tax Amid U.S. Retaliation Threats

Jul 4, 2024, 02:52 AM

The Canadian government, led by Prime Minister Justin Trudeau, has authorized the implementation of a digital-services tax on large foreign technology companies. The tax, which is a 3% levy on revenue from digital firms retroactive to 2022, targets companies that provide digital services or sell data of Canadian users. This move has prompted warnings of trade retaliation from the United States, including the Biden administration and Congress. The U.S. is considering all tools to respond to this tax. The tax was enacted on June 28. Additionally, Canada's broadcast regulator plans to compel foreign streaming services like Netflix, Disney+, and Amazon Prime Video to contribute 5% of their Canadian sales.