Question Period Note: DIGITAL/PLATFORM ECONOMY

What is Canada doing to deal with the growing number of businesses using new digital business models?

• Canada, like all countries, is seeking to update its tax regime to adapt to new digital business models.
• The Organisation for Economic Co-operation and Development (OECD) is striving to produce consistent Global approaches, however some countries have implemented unilateral measures.
• The Canada Revenue Agency (Agency) is engaged with the Department of Finance and the OECD on options that would enable the Agency to protect the tax base.
• The Agency is also acting on the action plans emerging from the 2019 Office of the Auditor General audit on E-Commerce. More specifically, the Agency is scaling up its activities as the size of this sector grows.
• The Agency is committed to ensuring that Canadians are aware of their tax obligations through a mixed use of research, education, communications, and enforcement.

The issue of digital taxation was a focus of the OAG report on Taxation of E-commerce published on May 7, 2019. This audit focused on whether, according to their respective roles and responsibilities, the CRA, the CBSA and Finance Canada ensured that the sales tax system for e-commerce was neutral and that the GST/HST tax base was protected. Part of the OAG’s findings concluded that the existing legislation placed Canadian businesses at a disadvantage in relation to foreign vendors.

The CRA has taken appropriate first steps, within the existing legislation and in line with the level of tax revenues at risk, to address the risks of non-compliance in e-commerce. REDACTED

REDACTED.

The CRA is monitoring changes in other jurisdictions, and participates in OECD discussions on e-commerce to help shape a consistent global approach. REDACTED

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