Canada's Digital Services Tax To Stay In Place Despite G7 Deal (financialpost.com)
- Reference: 0178205858
- News link: https://news.slashdot.org/story/25/06/27/1935258/canadas-digital-services-tax-to-stay-in-place-despite-g7-deal
- Source link: https://financialpost.com/technology/canadas-digital-services-tax-g7
> Canada is [1]proceeding with its digital services tax on technology companies such as Meta despite a Group of Seven agreement that resulted in removing the Section 899 "revenge tax" proposal from U.S. President Donald Trump's tax bill. The first payment for Canada's digital tax is still due Monday, the country's Finance Department confirmed, and covers revenue retroactively to 2022. The tax is three percent of the digital services revenue a firm makes from Canadian users above $20 million in a calendar year.
>
> Keeping the digital tax will not affect the G7 agreement, which focuses on global minimum taxes, the Finance Department said. The Section 899 provision would have targeted companies and investors from countries that the U.S. determines are unfairly taxing American companies. [...] Finance Minister Francois-Philippe Champagne suggested to reporters last week that the digital tax may be negotiated as part of broader, ongoing U.S.-Canada trade discussions. "Obviously all of that is something that we're considering as part of broader discussions that you may have," he said.
>
> Business groups in the country have opposed the tax since it was announced, arguing it would increase the cost of digital services and invite retaliation from the U.S. It also raised the ire of U.S. businesses and lawmakers. A group of 21 members of U.S. Congress wrote to Trump earlier this month asking him to push for the tax's removal, estimating the June 30 payment will cost U.S. companies $2 billion. Before scrapping its digital services tax, Canada wants to see an OECD deal on policies that expand a country's authority to tax profits earned within that country even if a company doesn't have a physical location there -- which is different from a global minimum tax.
Earlier today, President Trump said the U.S. is immediately ending trade talks with Canada in response to the tax, calling it a "direct and blatant attack on our country."
"Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately," Trump wrote in [2]a post on Truth Social. "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."
[1] https://financialpost.com/technology/canadas-digital-services-tax-g7
[2] https://truthsocial.com/@realDonaldTrump/posts/114756567645919781
TACO (Score:4, Insightful)
By Monday grandpa will have changed his mind.
Fascinating (Score:1)
It's fascinating to me that country A has deep concerns over what country B levies in taxes on entities within country B.
If country A feels that country B is getting some advantage by lowering taxes, country A is free to also lower taxes, thus eliminating that advantage.
Equally fascinating is the concern that somewhere, somehow, some entity has made some money without paying some other entity taxes on it.
Re: (Score:2)
The argument is that some companies that are physically located in country A operate in country B but do not pay taxes there. If they were regular goods or services companies they (or their customers) probably would have to pay taxes through various mechanisms. But because they're "digital services" i.e. advertising on web pages, they don't.
If you want the US to start taxing offshore tax schemes, like Microsoft licensing their logo from an Irish company for 90% of their revenue, it's the same situation.
Or y
Re: (Score:1)
> The argument is that some companies that are physically located in country A operate in country B but do not pay taxes there.
So what? If Country B doesn't want to levy a tax on what goes on in Country B, it's none of Country A's business.
Re: (Score:2)
While we are talking about freedom, what about what state C does in it's own state? Should state N and state O force the federal government to make what they do illegal in their own state because those other states said so? [1]StatEs RigHts11!! [bbc.com]
[1] https://www.bbc.com/news/business-30542646
Shocking (Score:2)
This is a fair and proportionate response to such a ridiculous policy. The idea of a nation taxing a foreign company not operating within their borders for transactions with (or involving) their citizens is preposterous, and it's curious how they even conceived of such a hare-brained cash-grab!
That was, naturally, sarcasm. Uncle Sam *always* wants a piece of the pie. For instance, foreign streamers that monetize will (generally?) be taxed on earnings resulting from viewers in the US. I find this specific
*sigh* Very Mature (Score:4, Insightful)
This is a tax that had been approved back in 2024, and scheduled for deployment in June 2025. This isn't new, or news; at least it shouldn't be. So Trump finds out that this tax is coming up and doesn't like it... well okay, fair enough I guess, he's free to not like Canadian tax laws. So why not, I don't know, say: "Hey Canada, WTF is this? Let's discuss you axing this tax, or there will be repercussions" like a normal bully. But no, he comes out with "Fine! I'm not talking to Canada anymore!" like a normal child . JFC
Re:*sigh* Very Mature (Score:4, Insightful)
> "Hey Canada, WTF is this? Let's discuss you axing this tax, or there will be repercussions" like a normal bully. But no, he comes out with "Fine! I'm not talking to Canada anymore!" like a normal child .
He's just a typical kid who was bullied who turns into one because that's all he emotionally knows. He behaves like a child because he was stunted as one. I have carrots the same colour as his face in my garden with more emotional stability and empathy than he could possibly ever show. And I'm sure Nixon and Johnson and Ike etc could drop an F bomb as well as anyone could, but in front of TV cameras? Guy has no sense of decorum or common manners (yeah, I'm old, like "mom used to go the bank with gloves on old", manners mattered once, kids). Plus, having been given millions from daddy probably didn't help his emotional growth either. TACO.
Re: (Score:2)
TACO is in a snit. It would be idiotic of Canada to back down on the tax until the very last minute of trade negotiations. Canada obviously wants to have something it's willing to give up to push negotiations past the finish line, but giving it up before negotiations even begin is absurd.
Anyway, f*ck Trump and Happy Canada Day for Tuesday.
Re: (Score:2)
The tax was passed in 2024 and Canada wants to collect it retroactive to 2022. If there's one kind of tax I don't like it's a retroactive tax.
Trump is a fucking idiot (Score:3)
It's incredible even a single moron voted for him, let alone millions of them.
The US is a shithole now. Happy Canada Day!
Re: (Score:3)
This is where his supporters on /. tell us that voting for Harris would have been voting for foreign wars...
Re:American Tariffs could STARVE Canada. (Score:5, Informative)
Canad is net food exporter. While US/Canada war is devastating to Canada due to size of economies, there won't be food shortages in Canada even if US goes as far as close the border.
Re:American Tariffs could STARVE Canada. (Score:4, Insightful)
Why? He isn't implementing export tariffs. All of his tariffs are import tariffs that raise prices for AMERICAN consumers. Canada doesn't pay the US 1 red cent for any of the tariffs that he's implemented. Canada produces ~70% of its needed food. I think you underestimate how much of that remaining 30% comes from Mexico or South America for essentials.
Re: (Score:2)
Also, note, Canada has a higher self-sufficiency rate than the US according to this: [1]https://worldpopulationreview.... [worldpopul...review.com]
[1] https://worldpopulationreview.com/country-rankings/food-self-sufficiency-rate-by-country
Re: (Score:3)
Why on Earth would a Canadian go to the USA to shop for food , of all things?
With laxer regulations and your FDA being gutted, I consider certain American food like meat or dairy products to be hazardous.