House Republicans Tell USTR to Open Section 301 Probe for Canadian DST

Republicans on the House Ways and Means Committee are asking the Biden administration to open a Section 301 investigation on the discriminatory effects of Canada's recently enacted digital services tax. The administration earlier conducted investigations on other countries planning DSTs, but did not impose tariffs, as talks on a global taxation solution proceed.

"We call on the Biden Admnistration to deliver a quick and decisive response to Canada’s decision to move forward with a discriminatory digital services tax (DST). The United States cannot permit trading partners to levy taxes that uniquely target our firms and workers," the members, led by Chairman Rep. Jason Smith, R-Mo., wrote.

"Without swift action, the United States will not be ready to immediately retaliate when Canada’s discriminatory DST is applied. This is especially concerning because of the potential retroactive application of the DST," they wrote. They said they also expect the agency to start a USMCA state-to-state dispute with Canada.