Canadians Unhappy about Tax on Streaming Video
August 15, 2024
Unfortunately the movie industry has tanked worldwide because streaming services have democratized delivery. Producers, directors, actors, and other industry professionals are all feeling the pain of tighter purse strings. The problems aren’t limited to Hollywood, because Morningstar explains that the US’s northern neighbor is also feeling the strain: “The Motion Picture Association-Canada Asks Canada Appeal Court To Stop Proposed Tax On Streaming Revenue.”
A group representing big entertainment companies: Walt Disney, Netflix, Warner Brothers, Discovery, Paramount Global, and more are asking a Canadian court to stop a law that would force the companies to pay 5% of their sales to the country to fund local news and other domestic content. The Motion Picture Association- Canada stated that tax from the Canadian Radio-television and Telecommunications Commission oversteps the organization’s authority. The group representing the Hollywood bigwigs also mentions that its clients spent billions in Canada every year.
The representative group are also arguing that the tax would force Canadian subscribers to pay more for streaming services and the companies might consider leaving the northern country. Canadian Radio-television and Telecommunications Commission countered that without the tax local content might not be made or distributed anymore. Hollywood’s lawyers doesn’t like it at all:
“In their filing with Canada’s Federal Court of Appeal, lawyers for the group say the regulator didn’t reveal “any basis” for why foreign streamers are required to contribute to the production of local television and radio newscasts. The broadcast regulator “concluded, without evidence, that ‘there is a need to increase support for news production,'” the lawyers said in their filing. ‘Imposing on foreign online undertakings a requirement to fund news production is not appropriate in the light of the nature of the services that foreign online undertakings provide.’”
Canada will probably keep the tax and Hollywood, instead of the executives eating the costs, will pass it onto consumers. Consumers will also be shafted, because their entertainment streaming services will continue to become expensive.
Whitney Grace, August 15, 2024
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