Canada cuts digital service taxes to boost trade negotiations with America.

The new Canadian government is conducting complex economic-security negotiations with the United States to achieve the best deal for Canadian workers and businesses. Prime Minister Carney stated he is willing to extend the negotiations if necessary, but it will not be extended beyond what is necessary.

To support this process, the Minister of Finance and National Revenue, François-Philippe Champagne, announced that Canada would retract the Digital Services Tax (DST), paving the way for a comprehensive trade agreement with the U.S. Prime Minister Carney and President Trump agreed to resume negotiations with the goal of completing them by July 21, 2025.

The DST tax was announced in 2020 to tax large technology corporations that generate revenue in Canada but do not pay corresponding taxes. Although Canada has always prioritized multilateral solutions, the DST was a temporary measure in response to legal gaps. The tax collection scheduled for June 30, 2025, will be canceled, and the law to abolish the DST will soon be presented to Parliament.

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