Canada Implements Digital Services Tax on Major Tech Companies in 2024

Canada’s new digital services tax targets major multinational tech companies, aiming to fairly tax digital revenues generated within the country.

Canada has announced the introduction of a new tax aimed at large multinational tech companies, effective from this year.

The measure targets firms with substantial revenue streams both globally and within Canadian borders, with an annual global income exceeding 7.5 billion Euros and Canadian revenues of over 2 billion Canadian dollars.

This digital services tax, set at a rate of 3%, applies to various digital revenues including online marketplaces, advertising services, social media, and data generated from Canadian users.

This strategic fiscal policy seeks to ensure that companies contributing significantly to the digital economy within Canada pay their fair share of taxes.

Initially proposed in 2020 and postponed to allow for international discussions, the tax has been enacted following the lack of a global agreement by the start of 2024.

The Canadian government estimates that this tax will generate significant revenue over the next five years, enhancing the country’s fiscal strength and ensuring equity in the taxation of digital enterprises operating across borders.

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Deepanker Verma is a well-known technology blogger and gadget reviewer based in India. He has been writing about Tech for over a decade.

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Canada Implements Digital Services Tax on Major Tech Companies in 2024

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