The Canadian government has decided to remove its digital services tax (DST), following the U.S. government's strong opposition to the measure. The initial DST payments, which were due today, included retroactive charges dating back to 2022. U.S. companies were expected to pay nearly $3 billion based on revenues, with annual costs potentially reaching up to $2.3 billion, according to a study by the Computer & Communication Industry Association’s Research Center.
CCIA has been advocating for the removal of the DST since its introduction and welcomes this recent development.
Matt Schruers, President and CEO of CCIA, stated: “It is encouraging that Canada is walking back its Digital Services Tax that mainly targeted U.S. exporters. We commend the U.S. and Canadian governments for reaching this agreement ahead of the June 30 payment deadline." He also urged other countries with similar taxes, such as the UK, France, Germany, and Italy, "to follow suit and commit to fair, reciprocal international tax principles.”