US opposes Canada’s digital services tax proposal

The United States Trade Representative's (USTR) office said on Tuesday it opposed Canada's plan to enact a digital services tax (DST) and urged Canada to abandon plans for such a step.

"The United States urges Canada to abandon any plans for a unilateral measure and instead redouble its commitment to the rapid implementation of Pillar One of the October 8 OECD/G20 agreement and the negotiation of a multilateral convention", the USTR office said in a statement.

The USTR also raised concerns about measures that it said singled out American firms for taxation while excluding national firms engaged in similar lines of business.

"Should Canada adopt a DST, USTR would examine all options, including under our trade agreements and domestic statutes", the USTR statement added.

The Canadian government said it had proposed the DST to protect Canadian interests and it remained in close contact with the United States over the issue.

"It is our sincere hope that the timely implementation of the new international system will make this Digital Services Tax unnecessary", a representative from the office of Canada's deputy prime minister said.