Canada to push ahead with digital services tax on global tech firms

Canada will press ahead with introduction of a digital services tax on large technology companies, which would raise C$5.9 billion ($5.5 billion) over the five years starting fiscal 2024/25, its federal budget showed.

Seeking to address the challenge of taxing digital giants like Google parent Alphabet and Amazon.com that can book their profits in low-tax countries, Canada had held off for two years to allow for the conclusion of talks on a global treaty on taxing multinationals. Negotiations though are dragging.

Washington opposes the plan on the grounds that it unfairly singles out US firms.

“In view of consecutive delays internationally in implementing the multilateral treaty, Canada cannot afford to wait before taking action,” the finance ministry said in its annual budget.

“The government is moving ahead with its longstanding plan to enact a Digital Services Tax.”

The tax would begin to apply for the 2024 calendar year, with the first year covering taxable revenues earned since January 1, 2022.

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AndyC

Andy Curtis is an award-winning security consultant, researcher and public speaker. He has been working in the computer security industry since the early 1990s, having been employed by state and federal government, leading healthcare and banking providers across three continents. He has given talks about computer security for some of the world’s largest companies, worked with law enforcement agencies on investigations into hacking groups, and is a regular voice on TV and radio explaining IT security threats.

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