Levy brings reprisal fears

U.S. has threatened to respond to a new tax imposed on big tech firms

- LAURA DHILLON KANE

Prime Minister Justin Trudeau’s government has authorized the implementation of a digital-services tax on large foreign technology companies, despite warnings of trade retaliation from the U.S.

A government notice posted online indicated the tax came into effect as of June 28. It will apply for calendar year 2024, with that first year covering taxable revenues earned since Jan. 1, 2022.

The tax is a three per cent levy on the digital services revenue a company makes from Canadian users above $20 million in a calendar year. It would apply only to companies with annual worldwide revenue of more than about $1.1 billion.