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Canada Rules Out Tax On Streaming Services

by Mike Godfrey,, Washington

29 September 2017

The Canadian Government has said that it will not impose a new tax on online services.

The Government has released its new strategy for the cultural and creative industries. Its publication followed a consultation on "Canadian Content in a Digital World."

According to the "Creative Canada" document released by the Government, online services such as Netflix, YouTube, and Facebook have "become a part of our creative ecosystem and play a role in the production, distribution, and discovery of Canadian content." It explained that, during the consultation, "many Canadian stakeholders asked about how new players can contribute to Canadian content."

The Government has however "made clear that we will not impose new taxes on online services that will increase the cost of these services to Canadians," the document stated.

Instead, the Government intends to seek commitments from, and to pursue agreements with, the global internet companies that provide such services. It wants these companies to be "partners" in, and to contribute to, the Creative Canada initiative, "helping grow our creative industries with investments in production and distribution."

Launching the initiative, Melanie Joly, Minister of Canadian Heritage, said that there had been a shift in how people access content, with this increasingly taking place online. However, she noted that "access and affordability of internet and wireless are real issues for many," and, with Canadians paying "some of the highest rates in the world," the Government "won't increase the cost of these services to Canadians by imposing a new tax."

Joly had previously ruled out a "Netflix tax" during the consultation.

The Canadian Audio-Visual Certification Office (CAVCO) recently announced that audiovisual productions shown exclusively online will become eligible for the Canadian Film or Video Production Tax Credit, provided that a Canadian distributor or broadcaster is involved.

Joly said that the Government "will improve the administration of the film and TV production credits by CAVCO," and will "work with Telefilm to explore ways to streamline the application process." The Government aims to reduce the existing backlog in paperwork and then to eliminate it entirely.

TAGS: tax | investment | value added tax (VAT) | cultural heritage | agreements | internet | Canada | services

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