Library of Parliament Background Paper: How Do Digital Multinationals Legally Avoid Tax in Canada?

The Library of Parliament recently published a background paper on how large digital companies like Google, Apple, Facebook and Amazon avoid corporate tax:

"In October 2019, noting that a growing number of countries no longer want to wait for an international agreement to be reached and are taking unilateral measures to tax certain multinationals, including those in the digital economy, the Secretary-General of the OECD [Organisation for Economic Co-operation and Development] proposed a unified approach to taxing multinationals. He hoped to restart negotiations between countries so that an international agreement could be reached by the end of 2020."

"In Canada, the federal government will have to decide whether to quickly implement its own tax on multinational digital companies, often referred to as 'GAFAs' in reference to Google, Apple, Facebook and Amazon, or whether to wait for the conclusion of an international agreement, which is anticipated in 2020, but is likely to be later, based on previous delays involving multilateral negotiations."

The paper looks at current Canadian corporate tax law and the development of an international tax treaty. It also examines the policies of the European Commission, France and United Kingdom.