Canada may face 'big fight' with U.S. over digital tax plans, American envoy warns

A "big fight" between Canada and the United States could be looming over the federal Liberal government's plan to impose what Washington's envoy to Ottawa described Tuesday as a "discriminatory" tax on digital services.

David Cohen, whose nearly two years as U.S. ambassador have been marked by friendly but frank and sometimes blunt talk about cross-border concerns, issued the warning after a luncheon speech hosted by the Canadian Club of Ottawa. 

"That will be an area of contention unless it is resolved," Cohen told his audience when the subject of Canada's digital services tax came up during the question-and-answer session. 

"There's a place where we're either going to have to have agreement, or we're going to have a big fight."