February 23, 2022

The United States has expressed its dissatisfaction with Canada over its decision to introduce a tax on digital services through the U.S. Trade Representative (USTR).

The USTR then called on Canada to abandon such plans, and also raised concerns about measures that it claimed singled out American firms for taxation. The same measures however excluded Canadian national firms who have similar businesses.

“The United States urges Canada to abandon any plans for a unilateral measure and instead redouble its commitment to the rapid implementation of Pillar One of the October 8 OECD/G20 agreement and the negotiation of a multilateral convention. Should Canada adopt a DST, USTR would examine all options, including under our trade agreements and domestic statutes,” the USTR office explained in a statement.

Canada unveiled the proposed form of taxation in April, saying it would remain in place until a coordinated process for taxing large digital companies was formulated and adopted.

For more information, read the original story in Reuters.