Proactive Investors - Google (NASDAQ:GOOGL) will introduce a 2.5% surcharge on ads displayed in Canada starting in October, in response to the Liberal government's new digital services tax, according to media reports.
Approved by Parliament in June, the tax imposes a 3% levy on foreign tech companies generating revenue from Canadian users.
A Google spokesperson stated to the Canadian Press that the surcharge aims to cover the costs of complying with this tax.
The Interactive Advertising Bureau of Canada warned that this move might lead other platforms to implement similar charges, increasing advertising costs.
US-based trade associations and business groups have opposed the tax, urging the Biden administration to address it under the U.S.-Mexico-Canada Agreement, as it targets American companies and the digital economy.