Canada’s Deputy Prime Minister and Minister of Finance, Chrystia Freeland, speaks to news media before announcing her first fiscal update, the Fall Economic Statement 2020, in Ottawa, Ontario, Canada, on November 30, 2020. REUTERS / Blair Gable / File Photo
Canada’s first budget in two years, presented to parliament on Monday, proposes a sales tax on online platforms and e-commerce warehouses, a tax on digital services for web giants and a luxury tax on items such as yachts, government resources trusted said with the document.
It will not include a wealth tax, a levy demanded by the opposition New Democrats. Liberal Prime Minister Justin Trudeau’s budget will need the support of at least one opposition group to succeed.
“The government is not pursuing a wealth tax,” a government source told Reuters. “We will take sensible steps to close loopholes and tackle tax evasion, and ask those who are currently doing well to pay just a little more.”
The budget includes a tax on online platforms and e-commerce warehouses from July, and a tax on digital services on large web businesses from 1 January 2022, both of which were originally promised last year.
Online platforms include foreign providers without physical presence in Canada selling products such as mobile applications and online video games. Ecommerce warehouses are the storage of physical goods before they are sold online.
A luxury tax on new cars and private jets worth more than C $ 100,000 ($ 79,970) and boats worth more than C $ 250,000 will come into effect next year if the budget is implemented. RVs and snowmobiles have been released.
With the sluggish housing market in the country, the government proposes to tax vacant residential property owned by non-resident, non-Canadian owners from January 1, 2022.
Efforts will also be made to curb the purchases of jurisdiction by large, profitable companies that artificially reduce their tax liabilities in Canada, sources said.
From 2023, Canada intends to limit the amount of excessive interest expenses that can be deducted from profits, although small businesses will be exempt.
In 2022 or 2023, the budget will propose to limit multinational corporations’ ability to make artificial arrangements among countries that will eventually lower their tax rates in Canada.
The sources did not provide any details. Finance Minister Chrystia Freeland is due to present the budget on Monday around 16:00 (2000 GMT).
Freeland presented her first budget since she took over as finance minister last year, promising up to three billion years of stimulus to start an economic recovery in an election year. read more
Separately, the Toronto Star reported Sunday that Canada would set aside $ 12 billion in the budget to expand its key pandemic support measures, as much of the country is battling a virulent third-wave COVID-19 infections. read more
($ 1 = 1.2504 Canadian dollars)
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