The tax would have cost companies like Meta, Google, and Amazon billions of dollars.
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CAROLINE WOODS: Billions of dollars in digital service taxes…avoided! Canada decided to scrap its controversial tax on American tech companies just hours before the first payments were due. Ottawa said instead it will focus on advancing broader trade negotiations with the United States.
The reversal comes after U.S. President Trump said over the weekend that he will be “terminating ALL discussions on Trade with Canada” in response to Ottawa’s decision to impose the tax – calling it a “ direct and blatant attack” on the US.
The first payments were initially set to be collected on Monday. The 3% levy would have been slapped on both domestic and foreign tech companies, including Meta, Amazon, and Google on the money they make from Canadian users and customers. Since it was retroactive to 2022, U.S. companies could have been looking at a $2-billion tax bill.
Canada’s Minister of Finance and National Revenue said quote “Rescinding the digital services tax will allow the negotiations of a new economic and security relationship with the United States to make vital progress and reinforce our work to create jobs and build prosperity for all Canadians.”
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