Canada - BEPS proposals for digital economy 

April 8: Canadian businesses that operate in the digital economy will want to follow the recent high-profile initiatives by the Organisation for Economic Co-operation and Development (OECD) in this area.

In its base erosion and profit shifting (BEPS) action plan, the OECD identified that the wide breadth of the digital economy presents particular challenges to existing international tax rules. The OECD released a discussion draft in March 2014 that identifies the tax challenges of the digital economy and summarizes potential alternatives to address such challenges (as originally stated in Action 1 of the plan). The OECD discusssion draft contains a detailed exploration of different options to consider for withholding tax, as well as viable options to collect VAT/GST on cross-border supplies.

In its 2014 federal budget, the Canadian government announced a parallel consultation process on BEPS and has set a consultation period for interested parties to provide input to the Department of Finance by 11 June 2014.

Read an April 2014 report prepared by the KPMG member firm in Canada: OECD Tackles Tax Challenges of the Digital Economy

©2013 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.

The KPMG logo and name are trademarks of KPMG International.

KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever.

The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

Direct comments, including requests for subscriptions, to
For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at:

+ 1 202 533 4366

1801 K Street NW
Washington, DC 20006.


Current and future KPMG clients may subscribe to TaxNewsFlash email alerts.

Email your contact information.

TaxNewsFlash-United States by year