Ottawa’s recently implemented levy on companies that provide digital services to Canadian users is “discriminatory,” and U.S. Trade Representative Katherine Tai should “immediately” launch a Section 301 investigation, a group of 25 Representatives said in a letter dated Thursday. (The Logic)
Talking point: Tai’s office has repeatedly expressed opposition to the Liberal government’s plan for a DST and warned it is considering “all options” in response. U.S. tech groups and elected officials argue Canada’s new tax targets Silicon Valley’s internet giants, though it would also apply to any Canadian firm that built a big enough online marketplace, advertising or social business. Under the Trump administration, USTR launched Section 301 investigations of nearly a dozen governments’ DSTs. The process can lead to retaliatory tariffs, but Tai did not end up imposing them. All sides say a better solution would be a global deal on multinational taxation via OECD-led talks.