Apple could be hit with billions in new taxes as Canada moves forward with its controversial Digital Services Tax (DST), despite objections from the United States. The Canadian government recently enacted the 3% levy on revenue that large tech companies earn from Canadian users, retroactive to January 1, 2022.
The tax applies to companies with global annual revenue exceeding $750 million, of which at least $20 million comes from Canadian users. This will affect major U.S. firms like Apple, Google, Amazon, and Meta.
The U.S. government strongly opposes the tax, arguing it discriminates against American companies. U.S. Trade Representative Katherine Tai has requested dispute settlement consultations with Canada, warning that the tax may violate the North American Free Trade Agreement.
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For Apple, this new tax could impact its digital services revenue in Canada, including income from the App Store, iCloud, Apple Music, and Apple TV+. The company has previously faced scrutiny over its tax practices in Europe and has advocated for a global agreement on digital taxation.
While Canada argues that DST are necessary to ensure fair contributions from large corporations, the U.S. and tech industry groups warn that taxes could harm trade relations and lead to higher costs for Canadian consumers.
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