Google Drops Canadian Ad Fee Following Digital Services Tax Repeal.

Key Takeaway

• Google has removed its 2.5% Canadian ad fee after Canada repealed its proposed digital services tax.
• Advertisers will receive refunds as Google aligns with Canada’s decision to avoid retroactive tech levies.

Google has announced that it is removing a 2.5% surcharge on ads shown in Canada, reversing a policy initially introduced in response to Canada’s now-scrapped digital services tax. The fee, which took effect in October 2024, will be fully refunded to advertisers once the federal tax legislation is officially repealed.

Last year, Google reportedly added the surcharge to offset the business impact of Canada’s planned levy, which targeted revenue from online advertising and user data monetization. The tax, set at 3%, threatened to impose additional costs totaling about US$2 billion on major tech firms, including Google, Amazon, and Uber, if applied retroactively.

Canada repealed the tax in late June 2025, ahead of a key deadline for retroactive payments scheduled for June 30. This move was seen as a diplomatic gesture aimed at smoothing Canada–U.S. trade negotiations. Google’s removal of the ad fee aligns closely with this development, suggesting a coordinated response to maintain advertising rates and support cross-border business stability.