Amazon has commended the Canadian government’s decision to withdraw its proposed digital services tax, describing the move as a positive outcome for both the company’s customers and broader trade relations.
The tax, introduced last year, was set to generate an estimated C$5.9 billion (US$4.2 billion) over a five-year period by targeting large US-based technology companies such as Amazon. With a payment deadline looming, tensions escalated between Ottawa and Washington, prompting the Canadian government to abandon the legislation on Sunday in a bid to revive trade negotiations.
The decision was welcomed by Amazon, which has long opposed digital services taxes imposed by foreign jurisdictions.
“Amazon applauds Canada’s decision to rescind the Canada Digital Services Tax Act,” a company spokesperson told AFP. “Digital services taxes are discriminatory, stifle innovation, and harm consumers, and we appreciate the US government’s work to address DSTs around the world.”
The United States had previously criticised the tax under the Trump administration, which had suspended trade discussions with Canada in response. The Canadian government’s reversal is seen as a conciliatory gesture to ease bilateral tensions and resume progress on cross-border economic issues.
Canada had been one of several major economies considering or implementing digital services taxes. Other countries, including Austria, Brazil, the United Kingdom, France, India, Italy, Spain and Turkey, have introduced similar levies aimed at ensuring that multinational technology firms pay tax in the markets where they operate, rather than relying on complex structures to minimise their liabilities.
-AFP
