Latest news with #DigitalServicesTax
NDTV
23 minutes ago
- Business
- NDTV
Digital Services Tax: Trump's Latest Beef With Canada
New Delhi: US President Donald Trump is once again going after Canada. He has announced through Truth Social that he is "terminating all discussions on trade" with Canada with immediate effect. The reason for his tirade this time is the Digital Services Tax. The Digital Services Tax was enacted last year, but companies are expected to start paying the tax from June 30. And since it will directly impact the big tech companies and large e-commerce platforms headquartered in the US, President Trump is seeing red. What is the Digital Services Tax The Digital Services Tax requires foreign and domestic large businesses to pay revenue tax that is earned from engaging with online users in Canada. It applies a three per cent tax on revenue earned from some digital services that rely on engagement, data, and content contributions. So, the taxable revenue could be generated through online marketplace services, online advertising services, social media services, and sales of user data. The Digital Services Tax will apply to companies or groups with annual global revenues of €750 million or more and Canadian digital services revenue of more than CAD 20 million. Significantly, the tax is retroactive to January 1, 2022, and companies will start paying the tax on June 30, 2025. Canada's rationale vs US pushback The overarching premise of the Digital Services Tax is that if big companies, that are based abroad, are earning significant revenue from Canadian users, then Canada should be able to tax a portion of that income. The revenue that Canada would make from the Digital Services Tax is expected to be around $875 million per year, said a note from the US Trade Representative last year. Over five years, the Digital Services Tax will increase federal government revenues by CAD 7.2 billion, per the Canadian Parliamentary Budget Office. The Computer and Communications Industry Association (CCIA) in the US claims that companies will end up paying up to $3 billion in taxes to Canada. It is also predicting 3,000 US job losses. What has been US' response in the past The US Trade Representative (USTR) had previously investigated Digital Services Tax in other countries and said that it had found them discriminatory toward US companies. The US had announced plans for retaliatory tariffs against the countries with Digital Services Tax and had said it would use the same yardstick for Canada. In August 2024, USTR Katherine Tai announced that the United States had requested dispute settlement consultations with Canada under the United States-Mexico-Canada Agreement (USMCA or CUSMA) regarding Canada's Digital Services Tax. The USTR had alleged that Canada's tax appeared to be inconsistent with its commitments under the Cross-Border Trade in services and investment chapters of the USMCA, not to treat US businesses less favourably than Canadian businesses. The US said that it had raised the concern with Canada in three official comments about its plan to enact a Digital Services Tax in June 2021, February 2022, and in September 2023. The US Chambers of Commerce has called the Digital Services Tax "discriminatory" and said that it is in contravention of prevailing international tax principles. It adds that doing so would not only discriminate against US companies but also directly contravene Canada's obligations under both the US-Mexico-Canada Agreement (USMCA) and the World Trade Organisation. Hence, President Trump's reaction to the Digital Services Tax as the date of payment closes in is hardly a surprise. Why is Canada not flinching yet on Digital Services Tax Earlier this month, Canadian Finance Minister Francois-Philippe Champagne had said the Digital Services Tax was passed by Parliament, and the government would hence go ahead with the tax. The reason why Canada went ahead and implemented its own Digital Services Tax was that the global effort to establish a broader, multinational digital taxation plan had been woefully delayed. Some argue that the Digital Services Tax is a unilateral measure that would undermine the stability of the agreed multilateral framework. However, with the Trump administration imposing unilateral tariffs - from aluminum and steel to automobiles and energy, against Canada - this argument is unlikely to move Canada. At a time when Canada feels betrayed by its largest trading partner, the United States, and is already reeling under the onslaught of the punishing Trump tariffs, it is beginning to assert its economic leverage. And the Digital Services Tax could perhaps serve as a negotiating tool in the process.
Yahoo
3 hours ago
- Business
- Yahoo
LILLEY: Carney puts Canadian jobs at risk over foolish tax idea
Mark Carney has decided to put Canadian auto jobs, manufacturing jobs, and the whole steel and aluminum industry at risk over a yet-to-be implement tax. It's a foolish move for the Liberals from both an economic point of view and from a negotiation standpoint. On Friday, Donald Trump announced that trade talks with Canada, the ones to try and ease the tariffs, were off. The reason, Carney's insistence on pushing ahead with a Digital Services Tax that comes into effect next week. It will require big tech companies like Apple, Uber, Amazon and others to pay 3% of their revenue from Canada — that's revenue, not profit — to the Canadian government. It also comes with a retroactive payment of roughly $3 billion for the American tech companies to cover the period going back to 2022. The bill imposing this legislation and the retroactive payments to 2022, only passed Parliament on June 20, 2024. No wonder President Trump calls this legislation unfair. Trump, like Biden before him, has been asking us to drop this tax, which both sides in America believe violates CUSMA, and we have refused to budge so now, he's walking away from talks. 'Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period. Thank you for your attention to this matter!' Trump posted to his Truth Social account. Speaking with reporters in the White House during a signing ceremony on Friday, Trump was blunt at times when asked about Canada. At first, Trump batted away a question about trade with Canada noting that the ceremony was about a peace deal between Rwanda and the Democratic Republic of Congo. Moments later, he made his views clear. 'Canada put a charge on some of our companies and Canada has been a very difficult country to deal with over the years,' Trump said. 'Economically we have such power over Canada. I'd rather not use it,' Trump said. 'It's not going to work out well for Canada. They were foolish to do it.' Foolish is correct because this means tariffs stay in place, jobs are put at risk and Canada suffers. It's not just voices in Washington saying that, it's coming from business groups and provincial premiers as well. Various industry groups have been warning the government that this was the wrong path to take and the Business Council of Canada had come out strongly against the tax. Carney Liberals urged to ditch DST as Trump terminates trade talks with Canada U.S. opposition to digital services tax long predates Trump administration 'In an effort to get trade negotiations back on track, Canada should put forward an immediate proposal to eliminate the DST in exchange for an elimination of tariffs from the United States,' BCC president and CEO Goldy Hyder said after Trump's announcement. Last October, when it still looked like Kamala Harris and the Democrats would be the likely winner of America's November election, Ontario Premier Doug Ford was calling for the DST to be scrapped. Speaking to the Empire Club in Toronto, Ford said the tax threatened Canadian jobs. 'I talk to Democrats, I talk to Republicans, and they are furious,' Ford said. 'We cannot put millions of Canadian jobs in our historic economic partnership with the U.S. at risk because of a stubborn refusal to listen to the concerns of our American friends,' Ford added. 'The federal government needs to pause the implementation of the digital services tax.' The Carney Liberals, much like the Trudeau Liberals refuse to listen to the Americans when they have issues with us on trade, but we expect them to listen to us. The Liberals seem to think this is a one-way conversation where we talk, they listen, and we get what we want. I've been hearing for months that we haven't caved on the DST because we are holding out to get something in return for dropping it. The tax comes into effect Monday, we have refused to drop it and we have gotten nothing in return. This isn't a Mark Carney elbows up moment; this is a complete and utter failure that anyone paying attention could have predicted.
Toronto Sun
3 hours ago
- Business
- Toronto Sun
LILLEY: Carney puts Canadian jobs at risk over foolish tax idea
Canadian jobs are now on the line over a foolish move to bring in a Digital Services Tax that is angering all sides in the United States. Get the latest from Brian Lilley straight to your inbox Prime Minister Mark Carney holds a closing press conference following the NATO Summit in The Hague, Netherlands on Wednesday, June 25, 2025. Photo by Sean Kilpatrick / THE CANADIAN PRESS Mark Carney has decided to put Canadian auto jobs, manufacturing jobs, and the whole steel and aluminum industry at risk over a yet-to-be implement tax. It's a foolish move for the Liberals from both an economic point of view and from a negotiation standpoint. This advertisement has not loaded yet, but your article continues below. THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. SUBSCRIBE TO UNLOCK MORE ARTICLES Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. REGISTER / SIGN IN TO UNLOCK MORE ARTICLES Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account. Share your thoughts and join the conversation in the comments. Enjoy additional articles per month. Get email updates from your favourite authors. THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK. Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account Share your thoughts and join the conversation in the comments Enjoy additional articles per month Get email updates from your favourite authors Don't have an account? Create Account On Friday, Donald Trump announced that trade talks with Canada, the ones to try and ease the tariffs, were off. The reason, Carney's insistence on pushing ahead with a Digital Services Tax that comes into effect next week. Industry told the Liberals to scrap the asked them to drop it. The Biden admin started a pending trade dispute with us. The Liberals kept this tax. Now Trump has cancelled all trade talks with us. We are killing other industries over this dumb tax. It must go. — Brian Lilley (@brianlilley) June 27, 2025 Your noon-hour look at what's happening in Toronto and beyond. By signing up you consent to receive the above newsletter from Postmedia Network Inc. Please try again This advertisement has not loaded yet, but your article continues below. It will require big tech companies like Apple, Uber, Amazon and others to pay 3% of their revenue from Canada — that's revenue, not profit — to the Canadian government. It also comes with a retroactive payment of roughly $3 billion for the American tech companies to cover the period going back to 2022. The bill imposing this legislation and the retroactive payments to 2022, only passed Parliament on June 20, 2024. No wonder President Trump calls this legislation unfair. Trump, like Biden before him, has been asking us to drop this tax, which both sides in America believe violates CUSMA, and we have refused to budge so now, he's walking away from talks. 'Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period. Thank you for your attention to this matter!' Trump posted to his Truth Social account. This advertisement has not loaded yet, but your article continues below. Speaking with reporters in the White House during a signing ceremony on Friday, Trump was blunt at times when asked about Canada. At first, Trump batted away a question about trade with Canada noting that the ceremony was about a peace deal between Rwanda and the Democratic Republic of Congo. Moments later, he made his views clear. 'Canada put a charge on some of our companies and Canada has been a very difficult country to deal with over the years,' Trump said. 'Economically we have such power over Canada. I'd rather not use it,' Trump said. 'It's not going to work out well for Canada. They were foolish to do it.' Foolish is correct because this means tariffs stay in place, jobs are put at risk and Canada suffers. It's not just voices in Washington saying that, it's coming from business groups and provincial premiers as well. Various industry groups have been warning the government that this was the wrong path to take and the Business Council of Canada had come out strongly against the tax. This advertisement has not loaded yet, but your article continues below. Read More 'In an effort to get trade negotiations back on track, Canada should put forward an immediate proposal to eliminate the DST in exchange for an elimination of tariffs from the United States,' BCC president and CEO Goldy Hyder said after Trump's announcement. Last October, when it still looked like Kamala Harris and the Democrats would be the likely winner of America's November election, Ontario Premier Doug Ford was calling for the DST to be scrapped. Speaking to the Empire Club in Toronto, Ford said the tax threatened Canadian jobs. 'I talk to Democrats, I talk to Republicans, and they are furious,' Ford said. This advertisement has not loaded yet, but your article continues below. 'We cannot put millions of Canadian jobs in our historic economic partnership with the U.S. at risk because of a stubborn refusal to listen to the concerns of our American friends,' Ford added. 'The federal government needs to pause the implementation of the digital services tax.' We need the federal government to pause the implementation of their Digital Services Tax. For our American partners, this is nothing but an unfair tax that's putting millions of Canadian jobs at risk. — Doug Ford (@fordnation) October 19, 2024 This advertisement has not loaded yet, but your article continues below. The Carney Liberals, much like the Trudeau Liberals refuse to listen to the Americans when they have issues with us on trade, but we expect them to listen to us. The Liberals seem to think this is a one-way conversation where we talk, they listen, and we get what we want. I've been hearing for months that we haven't caved on the DST because we are holding out to get something in return for dropping it. The tax comes into effect Monday, we have refused to drop it and we have gotten nothing in return. This isn't a Mark Carney elbows up moment; this is a complete and utter failure that anyone paying attention could have predicted. RECOMMENDED VIDEO Music Canada Crime Toronto & GTA Toronto Raptors
Yahoo
4 hours ago
- Business
- Yahoo
Trump Cuts Off Trade Talks With Canada Over Digital Services Tax
President Donald Trump on Friday said he was 'terminating ALL discussions on Trade' with Canada over the country's new digital services tax that aims to collect billions of dollars from American tech giants like Meta and Amazon, starting on Monday. 'We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country,' Trump posted on Truth Social. The president then said he was canceling all trade discussions with America's northern neighbor due to the 'egregious Tax.' He added 'We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period,' before adding his trademark sign-off, 'Thank you for your attention to this matter!' Canada's DST is a 3% tax on large tech companies with more than about $800 million in annual revenue. It targets companies involved in social media services and online advertising, which puts tech giants like Meta, the parent company of Facebook and Instagram, Amazon, and Google-parent Alphabet on the hook for payments. The first tax payment is due on Monday, and is retroactive to sales made since the start of 2022. The Wall Street Journal estimated that initial payment would be around $3 billion for the collective U.S. firms being taxed. Upon the president's post on Friday, Canadian Prime Minister Mark Carney's office shared a brief response. 'The Canadian government will continue to engage in these complex negotiations with the United States in the best interests of Canadian workers and businesses,' his office said. The post Trump Cuts Off Trade Talks With Canada Over Digital Services Tax appeared first on TheWrap. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Hindustan Times
5 hours ago
- Business
- Hindustan Times
Amazon to Google: List of tech giants to take a hit from Canada's Digital Services tax amid Trump trade row
President Donald Trump lashed out at Canada for imposing a Digital Services Tax (DST) on American tech companies. In a statement on Truth Social, the 79-year-old said he is calling off trade negotiations with Ottawa, and a new tariff rate will be announced within a week. Canada's Digital Services Tax is expected to hit Amazon(Unsplash) "Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately," Trump wrote in a scathing post. Canadian PM Mark Carney, however, insisted that his cabinet will continue to engage in trade negotiations. "We will continue to conduct these complex negotiations in the best interest of Canadians," he said, adding that he had not spoken to Trump on the day. Read More: What is Canada's Digital Services Tax threatening American tech companies | Explained The Digital Services Tax policy imposes a 3% tax on revenue from specific digital services provided to Canadian users, targeting companies with global revenue of €750 million (~US$801 million) and Canadian digital revenue exceeding C$20 million (~US$14.8 million) annually. Retroactive to January 1, 2022, with payments due by June 30, 2025, the DST primarily affects US tech giants due to their massive revenue in Canada's digital market. Here are the US tech companies that'll take a hit from DST 1. Google (Alphabet Inc) Google is expected to face the largest DST burden due to its extensive online advertising revenue in Canada. The DST targets ad services like Google Ads and YouTube, which dominate Canada's digital advertising market. Exact figures are not known at the moment. 2. Meta (Facebook, Instagram) Meta's social media services and advertising platforms generate massive Canadian revenue. The DST applies to revenue from user engagement and targeted ads, core to Meta's model. 3. Amazon Amazon's online marketplace services and cloud computing (AWS) generate substantial Canadian revenue. The DST targets marketplace sales and user data licensing. 4. Apple Apple's App Store, Apple Music, and iCloud services fall under the DST's scope for marketplace and data licensing revenue.
