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Federal Government Planning to Tax Tech and Internet Companies on Their User Data Collection

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The Canadian federal government is planning plans to begin taxing large tech and internet companies such as Google, Amazon, and Netflix on their data collection and ad purchases. The tax will be in a measure in working towards regulating user privacy and the collection of data.

Canadian Heritage Minister Steven Guilbeault spoke to CTV News recently and spoke about the new tax proposal. Guilbeault says that the Liberals will be introducing two new taxes, an extension of the government’s 2019 re-election promise, which sought to tax multinational tech companies on their revenue generated in Canada. The two new taxes include one focused on the use of user data. The second tax is squarely primed to centre on ad purchases.

During his interview with CTV News, Guilbeault brought up an example of user privacy abuse, one of which many may relate to.

“I’m a jogger, so I’ll go and look for a pair of jogging shoes on the website of a company, and then I come on my Facebook page and all of a sudden there’s a whole bunch of publicities about jogging shoes,” Guilbeault says. “Why is that? Well, because Facebook sold information to companies, without my permission… they’re making a profit out of it, out of our personal information. We think that there needs to be some fiscal framework put around that, because right now there’s none.”

In 2019, a major facet of the Liberal platform was instilling a three percent tax on the income of multinational businesses in the digital economy sector. The tax targeted companies such as Apple, Google, Netflix, Amazon, and any other tech company with worldwide revenues of $1 billion and Candian revenue of more than $40 million. The government also said it would work on privacy measures and creating new online rights for users.

However, privacy experts Michael Geist believes the new tax is counterintuitive to user privacy protection. While speaking to CTV News, Geist said “There are real issues with respect to privacy and the collection of our personal information. I don’t think the solution is to give the government the cut of the revenue that comes out of that.”

There’s currently no word on when the federal government plans to introduce the new taxes.

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