Canada plans digital tax in 2022 on global tech giants

OTTAWA: Canada plans to impose a tax on corporations providing digital services from 2022 that will stay in place until major nations come up with a coordinated approach on taxation, the finance department said on Monday.

The Organisation for Economic Cooperation and Development is working on a common approach to ensure digital behemoths, such as Google and Facebook Inc, pay their fair share of taxes as the coronavirus hammers budgets. Canada said it was concerned about a delay in reaching agreement.

The new tax would come into effect on January 1 2022 and remain in place until a common approach is agreed. The measure would raise federal revenues by C$3.4 billion ($2.6 billion) over five years, starting in the 2021-22 fiscal year.