Canada introduces ‘Netflix tax’ as officials award themselves bonuses

The Canadian Radio-television and Telecommunications Commission (CRTC) last week announced a new tax on streaming services in Canada.

A Netflix tax to fund ‘equity’ and ‘diversity’

Major streaming platforms like Netflix, Spotify, and Amazon Prime will be forced to pay 5% of their revenues to the CRTC annually, beginning this year. The “Netflix tax” is expected to yield $200 million for the Canadian government, which will spend the money on “diversity," "equity,” and local news broadcasters.

“The funding will be directed to areas of immediate need in the Canadian broadcasting system, such as local news on radio and television, French-language content, indigenous content, and content created by and for equity-deserving communities, official language minority communities, and Canadians of diverse backgrounds,” the CRTC said in last week’s announcement.

The cost of paying the tax is expected to be passed on to consumers.

“The federal government should be doing everything it can to make life more affordable and that means cutting taxes, not imposing new ones,” said Canadian Taxpayer Federation (CTF) Federal Director Franco Terrazzano. “Canadians have every reason to worry this new tax will mean higher prices to stream their favourite music, movies and TV shows.”

Tax comes despite Trudeau's promise

Canadian President Justin Trudeau promised in 2017 that a tax on streaming services would not be imposed.

"We respect the independence of committees and Parliament and the work and the studies they do, but allow me to be clear: We're not raising taxes on the middle class, we're lowering them," he said in response to a parliamentary recommendation to introduce a Netflix tax. "We're not going to be raising taxes on the middle class through an internet broadband tax. That is not an idea we are taking on."

Nearly all federal managers receive annual bonuses

The tax was announced days after a report found that Canadian government officials have been awarding themselves lavish bonuses despite poor performance indicators.

Ninety percent of executives and managers in most federal departments receive annual bonuses, according to government documents obtained by the CTF. These include 100% of the managers at the CFTC, the Human Rights Commission, Statistics Canada, and the Public Health Agency of Canada.

Overall, federal government agencies and departments received $210.8 million in bonuses last year, while employees in Crown corporations — businesses owned by the Canadian government — pocketed $195.6 million in bonuses.

These bonuses come despite a finding from Canada’s Budgetary Officer that, “less than 50% of [performance] targets are consistently met within the same year.”

Canadians suffering from carbon tax

The Netflix tax also comes as Canadians are reeling from Trudeau’s carbon tax, which penalizes citizens for climate change. Canadian farmers are being hardest-hit from the climate tax, with the average livestock farmer expected to receive a $726 climate bill every month. Crop farmers can expect to pay another $2,024 in monthly climate taxes, according to Rebel News.