Canadian digital tax policy has proven to be one of the most confusing areas of digital policy in recent years. For example, former Canadian Heritage Minister Melanie Joly struggled to convey a consistent position, often alternating between the 2015 electoral commitment of no Netflix taxes and the mounting pressure to implement some form of taxation on Netflix and other tech companies. It would appear that the complexity of the issue remains a challenge, as new Canadian Heritage Minister Steven Guilbeault issued as series of tweets yesterday that sought to clarify the government’s position. Yet rather than clarify, it highlighted how the government’s position remains somewhat confused.
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Government officials and cultural groups in Quebec have been banging the drum for much of the past year for the imposition of digital sales taxes on services such as Netflix. The debate is often framed around the notion that Netflix and other Internet companies should be collecting sales tax like any other service provider. Supporters argue that other countries have begun to levy sales taxes on digital services and Canada should do the same.
My Globe and Mail op-ed notes the federal government has sent mixed signals to date, with Prime Minister Justin Trudeau rejecting new taxes on the grounds that Canadians “pay enough for the Internet”, Canadian Heritage Minister Mélanie Joly seemingly keeping the door open to new taxes, and Finance Minister Bill Morneau committing to studying the issue while international standards develop.