A coalition of Canadian cultural sector entities is urging Prime Minister Mark Carney to retain the regulations mandating financial contributions from foreign streaming platforms such as Netflix to support Canadian content. The government had proposed replacing the existing 15% tax on major streamers’ Canadian revenue with direct government funding; however, the organizations argue that this substitution is inadequate.
In a joint communication to Carney endorsed by 50 organizations, it is highlighted that the committed yearly funding, unlike a CRTC-mandated contribution structure, is susceptible to alterations through the federal budget. The letter emphasizes, “The government’s annual pledge of $600 million, although well-received, is not a sufficient alternative to enduring, legally enforceable contribution responsibilities. Discretionary funding is susceptible to budgetary and external political influences, unlike a regulated contribution system.”
The signatories of the letter include the Canadian Media Producers Association, representing independent producers, as well as unions representing Canadian actors, writers, directors, and various film festivals.
Following the Canadian Radio-television and Telecommunications Commission’s decision to raise contributions for major streaming services to 15%, the government announced in June its intention to issue a new policy directive and allocate direct annual funding to the industry.
Subsequently, the government stated in a legal document that it would “remove” the financial contribution obligation for streamers.
The letter, also directed to Culture Minister Marc Miller, expresses concerns that the government’s June announcement has introduced considerable uncertainty into the production sector.
Prime Minister Mark Carney explained that the decision to eliminate a tax on major streaming platforms for Canadian content funding was primarily driven by concerns about affordability and had been made two months prior.
The letter underscores that the 15% contribution mandate “remains a suitable yardstick for the ensuing regulatory framework and should not be diluted by altering the foundational contribution mechanism. Upholding this threshold is equitable and reasonable.”
Despite Ottawa’s reversal on the streaming regulations following objections from the U.S. regarding the enabling legislation as a trade issue, the U.S. trade representative has indicated that Canada would not receive full recognition for this adjustment.