Canada won't delay digital services tax during U.S. trade negotiations, says finance minister

CBC

19-06-2025

Canada won't put a hold on the digital services tax on big tech companies set to take effect on June 30, the finance minister said Thursday.
Pressure has mounted on Ottawa to hold off while the government is in trade discussions with the U.S., which opposes the tax.
Finance Minister François-Philippe Champagne said the legislation was passed by Parliament, and Canada is "going ahead" with the tax.
"The [digital services tax] is in force and it's going to be applied," he told reporters before a cabinet meeting on Parliament Hill.
The digital services tax will hit companies like Amazon, Google, Meta, Uber and Airbnb with a three per cent levy on revenue from Canadian users.
It will apply retroactively, leaving U.S. companies with a $2-billion US bill due at the end of the month.
A June 11 letter signed by 21 members of Congress said U.S. companies would pay 90 per cent of the revenue Canada collects from the tax.
Canadian and U.S. business groups, organizations representing U.S. tech giants and American lawmakers have all signed letters in recent weeks calling for the tax to be eliminated or paused.
It is set to take effect just weeks before a deadline Canada and the U.S. have set for coming up with a new trade deal.
The Canadian Chamber of Commerce and other organizations have warned retaliatory measures in a U.S. budget bill could hit Canadians' pension funds and investments.
Champagne said Canada isn't the only country that could be affected by those retaliatory measures.
"These are discussions at the global level," he said in French.
Champagne said there's a wider discussion going on among G7 nations about tax regimes.
David Pierce, the Canadian Chamber of Commerce's vice-president of government relations, said in an earlier interview his organization fears Canada could "aggravate an already very tricky trade discussion" if it goes ahead with the tax and the retroactive payment requirement.
The Liberals first promised the tax in the 2019 election, but it was delayed for years due to global efforts to establish a broader, multinational digital taxation plan.