Liberal government enacts controversial digital services tax, raising trade concerns [Video]

The federal government has enacted a controversial digital services tax that will bring in billions of dollars while threatening Canada’s trading relationships by taxing the revenue international firms earn in Canada.

The Liberal government proposed the tax in its 2019 election platform. It later agreed to delay implementing the measure until the end of 2023 in the hopes it could reach a deal with other OECD countries on how multinational digital companies should be taxed.

Negotiations on an international deal continued to drag on past that date and the federal government issued an order in council on June 28 to enact the digital services tax (DST), which received royal assent June 20.

WATCH: Freeland defends controversial digital services tax  Reporters question Finance Minister Chrystia Freeland about the risk of U.S. retaliation after Ottawa moved to implement a digital services tax.

Deputy Prime Minister and Finance Minister Chrystia Freeland told reporters in Milton, Ont. on Thursday that “Canada’s preference is, and …