Prime Minister Justin Trudeau says Canada’s tax on Netflix and foreign digital services companies doesn’t seem to be much concern to U.S. President Joe Biden.
That’s even though it is a major irritant for the American tech sector.
In a year-end interview with The Canadian Press, Trudeau said “not once” did Biden indicate that the digital services tax, which is set to go into effect on Jan. 1, was a significant worry for the White House.
Trudeau said he was set to defend the policy and was ready with “all sorts of responses” had Biden raised the upcoming tax.
The three per cent levy is widely opposed on Capitol Hill and David Cohen, the U.S. ambassador to Canada, warned in October about the risk of a “big fight” over the tax.
The measure is aimed at ensuring foreign tech giants that are generating revenue from Canadian users are required to pay taxes on that revenue in Canada.
The bulk of those companies are based in the U.S.
Trudeau says he understands that Americans may not be very happy that Canada is going forward with it but he says “we have promised to do it.”
The digital tax was part of the Liberal election platform during the 2019 campaign, but the government delayed its implementation until 2024 in order to give more time to global efforts to establish a broader, multi-national taxation plan.