Amazon to Google: List of tech giants to take a hit from Canada’s Digital Services tax amid Trump trade row
President Donald Trump lashed out at Canada for imposing a Digital Services Tax (DST) on American tech companies. In a statement on Truth Social, the 79-year-old said he is calling off trade negotiations with Ottawa, and a new tariff rate will be announced within a week.
Canada’s Digital Services Tax is expected to hit Amazon(Unsplash)
“Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately,” Trump wrote in a scathing post.
Canadian PM Mark Carney, however, insisted that his cabinet will continue to engage in trade negotiations. “We will continue to conduct these complex negotiations in the best interest of Canadians,” he said, adding that he had not spoken to Trump on the day.
Read More: What is Canada’s Digital Services Tax threatening American tech companies | Explained
The Digital Services Tax policy imposes a 3% tax on revenue from specific digital services provided to Canadian users, targeting companies with global revenue of €750 million (~US$801 million) and Canadian digital revenue exceeding C$20 million (~US$14.8 million) annually.
Retroactive to January 1, 2022, with payments due by June 30, 2025, the DST primarily affects US tech giants due to their massive revenue in Canada’s digital market.
Here are the US tech companies that’ll take a hit from DST
1. Google (Alphabet Inc)
Google is expected to face the largest DST burden due to its extensive online advertising revenue in Canada. The DST targets ad services like Google Ads and YouTube, which dominate Canada’s digital advertising market. Exact figures are not known at the moment.
2. Meta (Facebook, Instagram)
Meta’s social media services and advertising platforms generate massive Canadian revenue. The DST applies to revenue from user engagement and targeted ads, core to Meta’s model.
3. Amazon
Amazon’s online marketplace services and cloud computing (AWS) generate substantial Canadian revenue. The DST targets marketplace sales and user data licensing.
4. Apple
Apple’s App Store, Apple Music, and iCloud services fall under the DST’s scope for marketplace and data licensing revenue.
