Washington – The Computer & Communications Industry Association is concerned with a recent proposal by Korean lawmakers that would require foreign digital platforms providing services to Korean users to pay a 2% digital service tax on gross revenues generated from domestic users. The sponsors explicitly model the proposal on Canada’s Digital Services Tax, a measure CCIA strongly opposed and helped lead efforts against before Canada formally withdrew it in March 2026.
Based on CCIA analysis, Korea’s proposed digital service tax is likely to disproportionately target U.S. firms, raising issues of discrimination that Korea earlier pledged to avoid. CCIA estimates that the proposal could result in over $500 million USD in annual DST liability for U.S. companies. CCIA urges U.S. and Korean policymakers to oppose this initiative.
The following can be attributed to Jonathan McHale, CCIA Vice President for Digital Trade:
“As the United States and Korea work to finalize commitments aimed at reducing barriers and ensuring mutually-beneficial market access, introducing a discriminatory digital service tax (DST) is a step in the wrong direction. We urge the government of Korea to clarify its lack of support for this ill-conceived initiative.”
