Canada Abandons Digital Services Tax to Foster International Cooperation
Ottawa, Canada – June 30, 2025 – In a significant policy shift, the Canadian government announced today its decision to repeal the proposed Digital Services Tax (DST). This move, effective immediately, aims to foster a more collaborative international environment for digital taxation and address concerns raised by global trading partners.
The Digital Services Tax, initially intended to ensure that large multinational technology companies contribute fairly to the Canadian tax base, had been a point of discussion and concern for several key allies. The government has indicated that this decision was made with a view to prioritizing multilateral solutions and ensuring that Canada’s approach to taxing the digital economy aligns with broader international efforts.
A spokesperson for the Ministry of Finance stated, “Canada remains committed to a fair and equitable tax system for all businesses operating within our borders. We believe that the most effective way to address the challenges posed by the digital economy is through coordinated international action. We will continue to work closely with our G7 and OECD partners to develop robust and sustainable solutions that reflect the evolving global economic landscape.”
The decision to scrap the DST comes after extensive consultations and engagement with various stakeholders, including industry representatives, international bodies, and allied governments. The government expressed its gratitude for the constructive dialogue and input received throughout this process.
This development is seen as a positive step towards strengthening Canada’s relationships with its trading partners and underscores the nation’s dedication to global economic stability and cooperation. Canada is expected to remain actively involved in international discussions on digital taxation, advocating for a framework that is both comprehensive and mutually beneficial. The government reaffirms its commitment to ensuring that all companies, regardless of their digital presence, contribute their fair share to public services and infrastructure.
Canada scraps digital services tax to ease Trump’s ire
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