Canada’s Digital Services Tax is going to be affecting Google Ad users soon. Messages are being sent to their customers.
Consequences of Canada’s recently implemented Digital Services Tax are already beginning to rear their ugly heads. Already, US lawmakers are urging a “quick and decisive response” to the new tax that targets American businesses. This was a major concern by the business community in Canada, but, as usual, the Canadian government ignores the very real concerns (just like Bill C-11 and Bill C-18).
One of the things I’ve long said over the years is for online services to add a separate line in everyone’s bills, clearly indicating why Canadian’s are being charged extra. Here’s what I wrote in one of those previous reports:
Of course, the damage that this will ultimately unleash will go far beyond whichever businesses the US government winds up targeting. That money has to come from somewhere and the likely source of that revenue will very likely come from consumers in the form of higher subscription costs. This has been something that has been long warned about among streaming platforms and it’s difficult to see how this would go down any other way. As I’ve suggested all along, I think a brilliant move on the part of platforms would be to insert the cost of the Digital Services Tax as a separate line item on people’s bills afterwards. Not only would this be an exercise in transparency, but Canadians will know exactly who to blame for that item in the first place.
This is one thing I’ve long held as a viable response. After all, everyone with any sense of reality for the situation knew that the likely response from online platforms was to pass along that charge to consumers, so this would be the best way to move forward with that. Well, it appears that Google has been reading Freezenet as this is the exact response they are apparently making to this ridiculous tax. This according to one user:
Good news everyone, @google is passing the cost of the DST to me, and I will in turn pass it to you! pic.twitter.com/nvuGDtj9Al
— David Portier (@optimistictory) August 1, 2024
Good news everyone, @google is passing the cost of the DST to me, and I will in turn pass it to you!
Here’s the screenshot:
For those who can’t see the image, here is a transcript of what it says:
Dear Customer,
On 1 October 2024, Google will begin charging a new surcharge for ads served in Canada.
Updated surcharges
As of 1 October 2024, we will begin adding a new ‘Canada DST Fee’ surcharge to your next invoice or statement for ads served in Canada. This means that invoices or statements for Ads served on or after 1 October 2024 will include a surcharge at a rate of 2.5% for ads served in Canada.
The Canada DST fee is being added to cover part of the costs associated with complying with digital services tax legislation in Canada.
I personally have looked through my own accounts for this message, but haven’t received this message so far. Still, I am more or less expecting this at this point in time.
This represents history repeating itself here. Supporters of the Online News Act insisted that Meta would never drop news links in Canada. Experts and observers like myself argued that they likely would, given the circumstances. Those supporters dismissed those concerns and concluded it was all a big fancy “bluff”. Then our predictions came true and Meta blocked news links in Canada. Those desperate supporters insisted that the blocking wouldn’t last a week. Today, the block has been in place for more than a year and counting.
With the Digital Services Tax, experts and observers like us argued that it would unleash a whole suite of consequences. This includes potential trade retaliation from the United States as well as online services passing those costs onto consumers. We were largely ignored as the government charged full steam ahead while refusing to learn from history. Now, history is repeating itself. Trade retaliation is seemingly not a matter of “if”, but “when”, and Google has already announced that they would be passing those costs onto consumers. As usual, us critics were right about everything and the supporters of these policies, and the government, were wrong about everything.
As we’ve said previously, while we tried to inform the government and raise awareness about the situation, now that these laws are being implemented, all we can do know is document all the damage that these laws are causing. Can’t say the government wasn’t warned at least.
(Via @MGeist)
