Prepare to Pay a “Netflix Tax” in Canada Michael Kwan January 17, 2017 News When you get cell phone service from Telus, you pay sales tax. When you get cable TV from Shaw, you also pay sales tax. The same is true with the CraveTV streaming service by Bell. It’s the price of doing business in Canada, right? Why is it, then, that when you sign up for Netflix or Amazon Prime, the tax man doesn’t take his cut? That’s an argument being put forth by the Liberal government supporting what many are calling a Netflix tax. An internal document obtained by the CBC, addressed to Canadian Heritage Minister Melanie Joly, says that not collection sales tax “represents a significant loss of potential tax revenue.” Moreover, it can “place domestic digital suppliers at an unfair competitive disadvantage.” Even if we were to say that CraveTV and Amazon Prime Video are 100% equivalent in every other way, the very fact that the former charges sales tax while the latter does not makes Bell’s offering “more expensive than those of offshore business.” Something that is very important to note is that the enforcement of a sales tax is not the same as the so-called Netflix “levy” that was previously proposed. That was originally intended “to help fund Canadian productions.” The “Netflix tax” would just go into the general revenue bucket, both at the federal and provincial level. Annie Donolo, spokesperson for Finance Minister Bill Morneau, says that the goal is simply to ensure “that Canada’s tax system is fair and supports the objectvies of an economy that works for everyone.” In the meantime, keep enjoying The Grand Tour and The OA to your heart’s tax-free delight. When and if such a tax will be enforced is anyone’s guess, but that internal memo is dated June 23 of last year. Share This With The World!
