Canada still ready to impose digital services tax – Department of Finance

OTTAWA, Dec. 14 (Reuters) – Canada is still prepared to impose a tax on companies providing digital services, the Department of Finance said on Tuesday in an announcement intended to anger the United States.

Canada first unveiled the measure proposed in the April budget, saying it would stay in place until major countries come up with a coordinated approach to tax digital giants like Alphabet Inc’s Google (GOOGL.O) and Facebook Inc (FB.O).

The Organization for Economic Co-operation and Development has agreed on a common approach to ensure that these companies pay their share of taxes, but a treaty to enforce it has not yet been implemented.

In a tax update, the finance ministry said the new tax would be imposed as of January 1, 2024, but only if the international treaty had not entered into force on that date. In this case, tax would be payable on income earned on January 1, 2022.

“The government sincerely hopes that the swift implementation of the new international system will make this unnecessary,” the update said.

(Report by David Ljunggren, edited by Julie Gordon)

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