Back in June, the CRTC announced a streaming tax that would force providers such as Spotify and Apple Music to pay up and contribute to a legacy broadcasting fund.
Now, Music Canada, the nation’s recording industry association, argues that this decision benefits traditional media while discouraging investment in new innovations.
Patrick Rogers, CEO of Music Canada, expressed disappointment, stating that the new rules focus more on industry policy than supporting Canadian artists. He criticized the allocation of nearly 50% of collected taxes to support terrestrial radio broadcasters.
“We spent three-and-a-half years working towards a modern regulatory system… We really bought into it, and we were happy to take part in it,” Rogers said to the National Post. “Throughout, I would say things like ‘the one thing we can’t do is jam the old rules onto this brand new economy,’ and everyone would go ‘oh no, we’d never do that.’”
Despite these efforts, Rogers called tax decision “bewildering” and a step backward, ignoring the role of licensed streaming in promoting Canadian artists’ careers.
The Online Streaming Act will force streaming companies with annual domestic revenues over $25 million to contribute 5% of their Canadian sales to support Canadian broadcasting. This is estimated to bring in $200 million annually to the Canadian Media Fund, the Independent Local News Fund, and diversity initiatives.
The CRTC defended the tax as a means to level the playing field in Canadian broadcasting, in a statement to the National Post.
“This decision is based on an extensive public record, which includes more than 360 detailed submissions and a three-week public hearing during which the CRTC heard from over 120 groups,” said the CRTC.
“Overall, this decision brings more fairness and more funds into the Canadian broadcasting system,” said the Commission.
Netflix, Disney and other streaming companies have already taken the CRTC to court over the streaming tax.
Any tax levied on streaming services will likely result in price increases, thusly being paid for by consumers. Spotify has made it abundantly clear that a streaming tax will force it to increase prices. Canadians will end up paying more for streaming services or even possibly lose access if services decide to give up on Canada.
Want to see more of our stories on Google?
P.S. Want to keep this site truly independent? Support us by buying us a beer, treating us to a coffee, or shopping through Amazon here. Links in this post are affiliate links, so we earn a tiny commission at no charge to you. Thanks for supporting independent Canadian media!
More and more tax so we can defend the absurd spending of Canada's credit card.
This government is a joke.