Canada optimistic about digital services tax agreement with US

Canada's Deputy Prime Minister and Minister of Finance Chrystia Freeland speaks to journalists on Parliament Hill in Ottawa, Ontario, Canada September 19, 2023. REUTERS/Blair Gable

OTTAWA (Reuters) - Canadian Finance Minister Chrystia Freeland said on Tuesday she was cautiously optimistic about settling a dispute with the United States about Ottawa's planned digital services tax (DST) on large technology companies.

The digital services plan aims to address the challenge of taxing digital giants like Alphabet and that can book their profits in low-tax countries.

The U.S. government has repeatedly objected to the planned Canadian tax. Washington says it unfairly singles out U.S. firms, and urged Ottawa to scrap the plan.

"I was in Washington last week and we did have some good conversations about the DST, including at officials level. I remain cautiously optimistic that we'll be able to reach an understanding with our American partners," Freeland told reporters in Ottawa.

Canada earlier this year said it was moving ahead with its taxation plan after holding off for two years to allow for a global consensus on taxing multinationals.

The process of negotiating a global tax deal has dragged on, and it was pushed back further in July to allow for more negotiations. Countries other than Canada that have a DST agreed to wait for the global deal for at least another year, instead of implementing their taxes.

Ottawa says not implementing its DST for another year would put Canada at a disadvantage relative to countries that have been collecting revenue under their pre-existing digital services taxes.

(Reporting by Ismail Shakil in Ottawa; Editing by Chris Reese and Jonathan Oatis)

Follow us on our official WhatsApp channel for breaking news alerts and key updates!


Next In Tech News

Apple to open Malaysia store on June 22 in South-East Asia push
Tesla settles fatal crash suit as another jury trial loomed
US billionaire plans dive to the Titanic in a newly designed submersible
Elon Musk dominates space launch. Rivals are calling foul.
US tech firm settles allegations over whites-only job listing
Ex-OpenAI board member provides her first detailed account of CEO ouster
Musk's Starlink back up after brief outage
Take this test to find out if social media really makes you happy
The steering wheel of the future could be square
Cathie Wood's Ark buys stake in Musk's xAI, Bloomberg News reports

Others Also Read