Digital Service Tax: A Threat to Productivity and Innovation

(TORONTO – June 21, 2024) – Today, the Ontario Chamber of Commerce’s (OCC) President and CEO, Daniel Tisch, released the following statement raising significant concerns with specific provisions for a new Digital Service Tax (DST) included in the passage of Bill C-59.

“Introducing this new tax in a time of economic stagnation is a step in the wrong direction. The DST would stifle productivity, hurt growth in our critical technology sector, and add unnecessary complexity to the regulatory environment. Businesses already struggling could face the additional burden of retroactive tax compliance, which is both unfair and counterproductive.”

“The tax targets digital platform operators, cross-border vendors of digital products or services, and businesses selling qualifying goods in Canada. This will have far-reaching implications for economic growth.

“Unilaterally introducing a DST in Canada could invite trade retaliation from international partners, notably the U.S., at a very sensitive time for this significant trade relationship. It also undermines efforts to implement the new two-pillar plan the G20 and OECD agreed upon.

“To foster economic growth and innovation, we urge the federal government to abandon any plans to implement this tax. Instead, we need a collaborative approach that supports productivity, simplifies regulatory compliance, and strengthens our competitive position globally.

“This is a critical moment for our economy. Government must support a favourable business climate, not create additional barriers to competitiveness and investment.”

-30-

About the Ontario Chamber of Commerce
The Ontario Chamber of Commerce (OCC) is the indispensable partner of business and Canada’s largest, most influential provincial chamber. It is an independent, non-profit advocacy and member services organization representing a diverse network of 60,000 members. The OCC’s mission is to convene, align and advance the interests of its members through principled policy work, value-added business services and broad engagement to drive competitiveness and sustainable, inclusive economic growth in the province.

For more information, please contact:
Andrea Carmona
Senior Manager of Public Affairs
Ontario Chamber of Commerce
andreacarmona@occ.ca | Mobile: (647) 234-0255