Michael Geist looks at the major federal party leaders’ reactions to discussion of a “Netflix tax”:
As part of the digital strategy discussion, I stated that questions abound, including “are new regulations over services such as Netflix on the horizon?”
Prime Minister Stephen Harper addressed that question yesterday with a video and tweet in which he pledged that the Conservatives will never tax digital streaming services like Netflix and Youtube. Harper added that the Liberals and NDP have left the door open to a Netflix tax, but that he is 100% opposed, “always has been, always will be.” Both opposition parties quickly responded with the NDP saying they have not proposed a Netflix tax and the Liberals saying they have never supported a Netflix tax and do not support a Netflix tax.
So is this much ado about nothing?
Not exactly. First, there are groups and provincial governments that support a Netflix tax or mandated contribution to fund the creation of Canadian content. These include the Ontario and Quebec governments along with many creator groups. Earlier this year, I obtained documents under the Ontario Freedom of Information and Protection of Privacy Act that showed that the Ontario government spent months working toward a recommendation to expand the regulation of new media, including Canadian content requirements and increased regulation of foreign online video providers.
Second, while the Liberals and NDP have not proposed a Netflix tax, they have called for requirements that online video providers disclose revenues, Canadian content availability, and subscriber numbers to Canadian regulators. This is a very soft form of regulation that Netflix and Google have rejected as beyond the power of the Broadcasting Act. Providing information to allow for more informed regulatory analysis does not seem particularly unreasonable, but the companies unsurprisingly fear that that analysis could ultimately lead to calls for more regulation or payments.
Third, the real Netflix tax is the prospect of a levying sales taxes on digital products such as music downloads or online video services. It was the Conservatives that raised this possibility in the 2014 budget, launching a consultation on the issue that garnered supportive comments from companies such as Rogers, which noted that Canadian-based online video services such as Shomi operate at a disadvantage since they collect GST/HST, but Netflix does not. With many countries moving toward some form of digital taxation (as I noted in a January 2015 column on the issue, the real challenge lies in the cost of implementation), it seems inevitable that Canada will do the same in order to level the playing field and recoup a growing source of revenue. The Conservatives would presumably seek to differentiate between a generally applicable sales tax and a tax or fee targeting online streaming services, though many may feel it is a distinction without a difference.


This October, NATO is launching Trident Juncture, its largest and most ambitious military exercise in a decade. The massive land, sea and air exercise will be held in the Mediterranean and will include 36,000 troops from 30 nations. Its goal will be to help the fictitious country of Sorotan, “a non-NATO member torn by internal strife and facing an armed threat from an opportunistic neighbour.” Not surprisingly, this is widely seen as an explicit response to Moscow’s increasingly belligerent pressure on the alliances’ eastern borders. The Canadian government, an outspoken critic of Russian President Vladimir Putin and the invasion of Ukraine, had planned to send its flagship destroyer, HMCS Athabaskan, as “a strong signal to the Russians,” whose ships and aircraft have also been bumping up against Canada’s territorial claims in the Arctic.



