The federal government plans to replace the financial contribution requirement for online streamers set by the CRTC with government funding, as stated in a court document. The attorney general’s office mentioned that the government intends to eliminate the base contribution requirement for streaming services and provide government funding as a replacement.
However, the Canadian Association of Broadcasters expressed disagreement with the government’s stated intention. Kevin Desjardins, the association’s president, emphasized that the language in the document does not align with previous communications from the government. He suggested it would be premature to draw definitive conclusions based on this administrative correspondence.
Culture Minister Marc Miller’s office declined to provide further clarification on the government’s position. When asked whether the elimination of the contribution requirement would be permanent or temporary, a spokesperson stated that they are currently developing a new policy direction and have no additional details to share at this time.
The government previously announced its decision to issue a new policy directive to the CRTC following the regulator’s increase of contributions for large streaming services from five percent to 15 percent of Canadian revenue. Instead of the contributions, the government plans to allocate $600 million annually to the industry.
The contributions, commonly referred to as the “Netflix tax,” were introduced following the passage of the Online Streaming Act by the Liberal government in 2023. The court document from July 17 mentioned that the government would soon publish the new policy directive to the CRTC.
Despite the change in direction, highlighted after the U.S. flagged the Online Streaming Act as a trade concern, the United States Trade Representative indicated that Canada might not receive acknowledgment for this adjustment. Canada-U.S. Trade Minister Dominic LeBlanc is currently in Washington amidst potential tariff threats on Canadian goods by U.S. President Donald Trump.
During a news conference, Prime Minister Mark Carney noted that the decision to eliminate the tax on large streamers had been made two months prior. He emphasized the government’s focus on affordability and cultural investments. Reynolds Mastin, president of the Canadian Media Producers Association, emphasized the importance of foreign streamers investing revenue back into Canadian content.
Hélène Messier of the Coalition for the Diversity of Cultural Expressions stressed the need for the government to guarantee annual funding for the audiovisual and music sectors, estimating it to be at least $200 million. NDP MP Heather McPherson criticized the government’s move as subsidizing U.S. tech and media companies, while Conservative culture critic Rachael Thomas opposed the CRTC’s contribution rules and raised concerns about the impact on Canadian media and content.