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Trudeau gov’t appears to back down on ‘digital services tax’ plans

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From LifeSiteNews

By Anthony Murdoch

‘feds need to stop dreaming up new taxes and new ways to make life more expensive.’

A plan by Prime Minister Justin Trudeau’s federal government to tax the advertising revenues of non-Canadian tech giants and other companies – which could spark a major trade war and make accessing the internet more expensive – seems to be off the table, at least for now.  

According to Canadian law professor Dr. Michael Geist, the Trudeau government seems to have “quietly backed down from its plans to implement a new Digital Services Tax (DST) as of January 2024.” 

In its 2019 election party platform, the Trudeau Liberals had promised to impose a three percent so-called DST, which could have brought in an estimated $7.2 billion, but at the expense of tech giants that all provide services to Canadians.  

In October, the head of the Canadian Taxpayers Federation (CTF) Franco Terrazzano said the “feds need to stop dreaming up new taxes and new ways to make life more expensive.” 

“Prime Minister Justin Trudeau should be doing everything he can to make life more affordable, but this Digital Services Tax will mean higher prices for ordinary Canadians,” he noted.  

The CTF noted that when France introduced a similar tax against tech giants such as Google, Facebook, Amazon, and other large online sites, it caused everything to get more expensive in the country.  

“An economic impact assessment of the French digital services tax shows that about 55% of the total tax burden will be passed on to consumers, 40% to online vendors and only 5% borne by the digital companies targeted by the new tax,” noted the CTF. 

Geist said that after months of the Trudeau government insisting a DST would be incoming next year, the government has removed that “implementation deadline” in their recent Fall Economic Statement. 

When news first broke of the tax in late 2019, many U.S. Senators and Representatives signed letters asking the Canadian government to delay implementing a DST, which they warned would have created disastrous consequences.  

Canadian Finance Minister Chrystia Freeland had been insisting up until recently a DST would be coming. In the summer 2023, she said, “Two years ago, we agreed to pause the implementation of our own Digital Services Tax (DST), in order to give time and space for negotiations on Pillar One. But we were clear that Canada would need to move forward with our own DST as of January 1, 2024, if the treaty to implement Pillar One has not come into force.” 

Even earlier this month Freeland seemed “cautiously optimistic” a deal could be reached between Canada and the U.S. for a DST. 

Geist noted that it now “appears that the optimism came from a decision to simply remove the January 1, 2024 start date,” to implement the tax and move it down the road to a later date. 

As noted in the Trudeau Liberals Fall Economic Statement, “In order to protect Canada’s national economic interest, the government intends to move ahead with its longstanding plan for legislation to enact a Digital Services Tax in Canada and ensure that businesses pay their fair share of taxes and that Canada is not at a disadvantage relative to other countries.” 

“Forthcoming legislation would allow the government to determine the entry-into-force date of the new Digital Services Tax, as Canada continues conversations with its international partners.” 

Geist noted that the delay in implementing a DST means that it “buys time for a potential international agreement on implementing a global approach to the issue and should relieve some of the external pressure.” 

Putting in place DST now would create ‘significant risks’ 

As it stands now, the Trudeau Liberals have already pushed forth bills that will regulate the internet. This includes the federal government’s censorship Bill C-11, the Online Streaming Act, which has been blasted by many as allowing the government more control of free speech through potential new draconian web regulations. 

Another Trudeau internet censorship law, Bill C-18, the Online News Act, became law in June 2023 despite warnings that it will end free speech in Canada. This new law forces social media companies to pay Canadian legacy media for news content shared on their platforms. 

Geist observed that while implanting a DST on tech giants might be more “preferable to the cross-industry subsidy model found in Bills C-11 and C-18,” pushing forth with a DST now would bring disastrous consequences and could spark a trade war.  

“Moving ahead now would have created significant risks, including the prospect of billions in retaliatory tariffs. Led by Bill C-18 and the digital services tax, the government talked tough for months about regulating big tech,” wrote Geist. 

“But with the (Fall Economic Statement) FES providing a massive bailout to compensate for the harm caused by the Online News Act and the decision to hold off on implementing the DST, it would appear that the tough talk has been replaced by much-needed realism on what amounted to deeply flawed policies and a weak political hand.” 

Geist has continually warned that the Trudeau government’s meddling with big tech by trying to regulate the internet will not stop at “Web Giants,” but will lead to the government going after “news sites” and other “online” video sites as well. 

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Trudeau pledges another $3 billion to Ukraine, including $4 million for ‘gender and diversity’

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From LifeSiteNews

By Clare Marie Merkowsky

Prime Minister Justin Trudeau has sent Ukraine over $13.3 billion, including $4 billion in direct military assistance since 2022.

Prime Minister Justin Trudeau is sending another 3 billion taxpayer dollars to Ukraine, including $4 million for a “gender and diversity” initiative in the embattled country. 

On February 24, Trudeau’s office announced $3.02 billion in funding for Ukraine as it continues its war against Russia, including millions of taxpayer dollars to promote “gender-inclusive demining.” 

“Canada will provide critical financial and military support to Ukraine in 2024, including new financial support for Ukraine to meet its balance of payments and budgetary needs and stabilize its economy,” a press release promised, without explaining why it’s Canada’s role to prop up Ukraine’s economy.   

Within the 2024 funds, Trudeau promised $4 million to promote “gender-inclusive demining for sustainable futures in Ukraine.” However, the government failed to explain what gender or diversity have to do with demining, and how it is in the interest of the Canadian taxpayer to fund ideologically driven initiatives in foreign countries. 

“This project from the HALO Trust aims to safeguard the lives and livelihoods of Ukrainians, including women and internally displaced persons, by addressing the threat of explosive ordnance present across vast areas of the country,” the press release said.  

“Project activities include conducting non-technical surveys and subsequent manual clearance in targeted communities; providing capacity building to key national stakeholders; and establishing a gender and diversity working group to promote gender-transformative mine action in Ukraine,” it added.  

Additionally, $1.5 million is being given to the Geneva International Centre for Humanitarian Demining to “enhance the capacity of Ukrainian mine action institutions to implement effective and gender-responsive mine action operations, develop country-appropriate information management solutions, and lead efficient mine action donor coordination platforms.”  

Since the Russia-Ukraine war began in 2022, Canada has given Ukraine over $13.3 billion, including $4 billion in direct military assistance.   

Trudeau’s ongoing funding for Ukraine comes as many Canadians are struggling to pay for basics such as food, shelter, and heating. According to a recent government report, fast-rising food costs in Canada have led to many people feeling a sense of “hopelessness and desperation” with nowhere to turn for help. 

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Alberta

Canadians in three provinces will spend roughly the same on debt interest as K-12 education

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From the Fraser Institute

By Grady Munro and Jake Fuss

From 2008/09 to 2023/24, the federal government is projected to have run deficits every single year, with no interruptions. This has resulted in federal net debt (total debt minus financial assets) increasing by $603.6 billion (inflation-adjusted).

For more than a decade, Canadian governments have increasingly relied on borrowed money to fund their excessive spending habits. However, as debt has continued to pile up so have the costs associated with this debt—namely interest costs. A recent study shows that in some of the largest provinces, governments now spend nearly as much or more on debt interest costs than on K-12 education.

Since the 2008/09 financial crisis, governments across Canada have fallen into the habit of utilizing debt to fund their spending habits. For example, consider the federal government.

From 2008/09 to 2023/24, the federal government is projected to have run deficits every single year, with no interruptions. This has resulted in federal net debt (total debt minus financial assets) increasing by $603.6 billion (inflation-adjusted). Conversely, from 1996/97 to 2007/08, the federal government actually lowered its net debt by $348.1 billion (inflation-adjusted). Clearly, there’s been a shift in the government’s approach towards debt accumulation.

This is not simply a federal problem, as provinces have also seen their debt burdens rise as well. Cumulatively, provincial and federal net debt has increased by $1.0 trillion (inflation-adjusted) from 2007/08 to 2023/24.

Government debt carries costs, primarily in the form of the interest payments, which represent money that doesn’t go towards paying down the actual debt amount, nor does it go towards providing government services or tax relief. And since governments must utilize tax revenues to pay interest, taxpayers are ultimately on the hook for servicing government debt.

But how much do Canadians actually pay in debt interest costs?

Using data from the most recent fiscal updates, a new study compares combined (federal and provincial) debt interest costs for residents in three of the largest provinces (OntarioQuebec and Alberta) with what those provinces expect to spend on K-12 education in 2023/24. The study utilizes combined debt interest costs because Canadians are ultimately responsible for interest costs incurred by both the federal government and the province in which they live. The following chart summarizes the comparisons from the study.

As is clear from the chart, combined interest costs for residents in these provinces are nearly as much or more than their province expects to spend on K-12 education in 2023/24. Specifically, combined interest costs are $31.5 billion for Ontarians, which is only $3.2 billion less than the province will spend on K-12 education in 2023/24. Combined interest costs for Quebecers ($20.3 billion) will actually exceed the $19.9 billion the province will devote towards K-12 education. And combined interest costs for Albertans are only slightly lower than the $8.9 billion that will be spent on K-12 education.

In other words, taxpayers in Ontario, Quebec and Alberta are paying nearly as much or more to service federal and provincial government debt than they are paying to fund K-12 education in their province. This budget season, it’s important to remember the costs associated with growing government debt.

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