Introduction
On June 28, 2024, the Digital Services Tax Act (DSTA)
entered into force.
The introduction of the Digital Services Tax represents a
significant shift in the country's approach to taxing the
digital economy. The Digital Services Tax Act is part of
Canada's broader strategy to ensure that digital economy
businesses contribute fairly to the Canadian tax system.
It applies to revenue categories such as online advertising,
social media services, user data sales, and online marketplaces.
The Digital Services Tax will be retroactively applied to revenues
from January 1, 2022.
Scope of Application of the Digital Services Tax
In general terms, the digital services tax is a 3% tax on
revenue generated from online services. It applies to revenue
categories such as online advertising, social media services, user
data sales, and online marketplaces. This broad definition
potentially encompasses all online business activities.
