Don’t Tax the Internet, Tax Foreign Companies!


tay
#1
If you think your internet bill is already too high, then hold onto your hat, because it could be about to get even higher. Right now, Heritage Minister Mélanie Joly and Finance Minister Bill Morneau are reviewing a proposal to impose a new Internet Tax that, according to experts (external - login to view), would cost Canadian consumers at least $500 million a year.

A number of groups representing content producers, such as the Writers’ Guild of Canada and the Canadian Media Producers Association, are pressuring the federal government to implement this new tax as part of its sweeping investigation of how best to support Canadian culture in a digital age. The government wrapped up this review late last year, with Joly expected to publish initial proposals any day now.

The current system governing Canada’s cultural industries has not had a significant overhaul in decades, so while there’s little debate about the need for an update, controversy has been swirling about what form this update should take — zeroing in on the question of how and to what extent Canadian content should be publicly funded.

For Tyee readers familiar with OpenMedia’s work, it will come as no surprise that we’re strongly opposed to an internet tax, as are over 36,000 of our community members who are calling on the Trudeau government to reject the idea. We’re keenly aware that Canadians already pay some of the highest prices in the industrialized world for internet access, with the result that many people, especially those in low-income communities, simply cannot afford the cost.

The contrast is stark. In a recent study commissioned by the CRTC, it was revealed that while 95 per cent of the highest-income Canadians have internet access, only 60 per cent of the lowest-income Canadians can say the same. And, as groups such as the First Nations Technology Council and First Mile Connectivity Consortium point out, Canada’s high internet prices also disproportionately impact Indigenous communities — especially those living in rural and remote areas.

In view of our deep digital divide, the last thing we need is a new tax that would make internet bills even more expensive, harm innovation and business, and force even more Canadians offline — especially given December’s historic CRTC decision declaring high-speed internet as a basic service for all Canadians, regardless of their income level or where they live.

However, there’s also little doubt about the need to find sustainable ways to support the production of quality Canadian content. So if an internet tax isn’t the answer, what is? As it turns out, there are a number of positive alternatives that would achieve the goal of supporting Canadian content without the attendant harms that would come as the result of an internet tax.

First, it’s simply unfair that while Canadian online companies are obliged to collect and remit GST/HST, foreign online companies — such as Netflix — are under no obligation to do so. This puts Canadian companies at a competitive disadvantage, while also depriving the federal government of revenue that could be redirected to support Canadian content. The government is currently considering applying sales taxes to foreign online services, and such a move would be a positive alternative to harmful new fees such as a “Netflix tax” (a content levy explicitly for online video services, which the government has thankfully ruled out) or an internet tax on monthly bills.

Second, part of the proceeds from auctions of valuable wireless spectrum could be redirected toward the production of Canadian content, for example through joint connectivity and cultural production programs that could improve rural connectivity while ensuring newly connected communities received content funding to tell their stories.

Third, the government could leverage revenues from telecom sector mergers and changes of ownership to provide additional funding to independent creators. This would have the effect of redirecting revenues from powerful, vertically integrated telecom giants to provide support for creators who are currently under-represented, thereby democratizing and diversifying our cultural policy.

Finally, if the government is serious about its commitment to provide sustainable support for Canadian content, it could choose simply to divert revenue from the general tax base, which would ensure the burden was spread more fairly among the population, rather than falling disproportionately on low-income and remote groups.

A combination of some or all of these options — outlined in greater detail in OpenMedia’s submission to the government’s #DigiCanCon consultation — would be a far superior and more equitable approach than an internet tax that, by forcing vulnerable people offline, would run counter to the government’s stated goal of expanding broadband access, and additionally undermine Canada’s innovation agenda.

As it turns out, Canadians agree. A recent Innovative Research Group poll, commissioned by OpenMedia, revealed that a majority of Canadians do want to support Canadian content but simply hate the idea of paying more for monthly internet and cell phone service in order to do so.

https://thetyee.ca/Mediacheck/2017/0...-Tax-Internet/ (external - login to view)
 
Curious Cdn
#2
What's a foreign company on a World Wide Web?
 
tay
#3
Quote: Originally Posted by Curious CdnView Post

What's a foreign company on a World Wide Web?

One that's not based in Canada........
 
Murphy
+1
#4  Top Rated Post
All governments, regardless of where they are in the world, share many of the same characteristics as living creatures. They consume, wish to grow and get stronger, produce waste and become sick. They also have a finite lifespan.

Instead of eating grass or other animals, governments feed on money. The biggest source for this is from the people that live within their borders. The government harvest is called taxes. Taxes are collected from virtually everything. Governments graze everywhere.

Think of this.

A tree gets chopped down and must be transported from the forest by truck. Fuel taxes, road taxes, income taxes from employees is the start of the taxation for that tree.

It gets brought to a yard for processing. Land taxes, more income tax, energy consumption to cut and process the wood converts, in part, to taxes. Office machinery, ads in trade papers to sell the wood all generate more revenue for the government, and the wood hasn't even been sold yet. And, of course, there were the permits, inspections and other monies siphoned from the lumber company on its journey to become something.

The wood gets sold and more taxes are applied. The wood is transported to wherever it needs to go and still more taxes are levied. The wood arrives, gets made into tooth picks or chairs, and yet again, more taxes are generated. The chairs go from the plant to a warehouse or store. Along the way, more electricity, gas, and equipment are needed for this former tree to make it to the consumer.

The chairs are sold to John Q. Public, and taxed again before being taken home.

You're saying, yeah, what's the big deal? I hadn't really thought about all the stages when tax money is made from that tree, but it all makes sense. Stop, and ponder this: how much money has the government actually made from the tree to this point? I dunno, but I'm sure a first year uni student or two has probably mapped it as an assignment. And everything we buy goes through a similar metamorphosis.

The government is always searching for new and inventive ways to come up with more money. An Internet tax isn't surprising. Once it is put into place, the tax becomes a legal income stream for the government. And dear me, don't get caught trying to evade paying any tax!

Governments can levy charges with impunity. To resist or refuse to pay will get you fined or jailed. In many cases when dealing with Revenue Canada, the judgment does not come from a trained lawyer, but the head of a tribunal, often an accountant, who has the law of the land backing him.

The sad thing about taxes is we have been programmed since we were children that in addition to the illegality of not paying, we are stealing from our fellow Canadians. Where does the money for healthcare, the roads, education, the military, etc. come from? So the government has, for the most part, people who turn over money without objection to fund whatever it is they wish to fund. The programming is complete by the time you're a teen.

Oddly, the government is under no obligation to spend responsibly. If they were, you'd see civil servants and elected officials swinging from trees or populating our prisons.

Don't like it? Vote them out. The trouble is, all governments, regardless of political leaning, spend. It is not the minister's money, it's the government's money. Spend!

We don't have sufficient checks in place to stop the spending. We do not have the proper deterrents in place when a government member knowingly spends tax money recklessly.

Like pigs to the trough, the government knows they can go to the people and get more. Carbon taxes, Internet taxes, income taxes, taxes on taxes. It just never ends.
Last edited by Murphy; Feb 18th, 2017 at 06:30 PM..
 
Curious Cdn
#5
Quote: Originally Posted by tayView Post

One that's not based in Canada........

What does "based" mean when a "Canadian site" might very well originate from a server in Latvia or the USA (and not very likely from Canada)?
 
Murphy
#6
'Based' means whatever the government determines 'based' should mean.

The sarcastic response would be, whatever the government needs 'based' to mean. I cannot think of a reasoned response to that question because the decision would have to be made by a competent, unbiased authority. Unfortunately, that's unlikely to happen. The best Canadians can hope for is a sensible parliamentary debate.
 
Curious Cdn
#7
Quote: Originally Posted by MurphyView Post

'Based' means whatever the government determines 'based' should mean.

The sarcastic response would be, whatever the government needs 'based' to mean. I cannot think of a reasoned response to that question because the decision would have to be made by a competent, unbiased authority. Unfortunately, that's unlikely to happen. The best Canadians can hope for is a sensible parliamentary debate.


It means that any government may not be able to legally do much to regulate internet websites that do not really correspond with a geographic location or "live" in any political entity, like a country. It seems to be ethereal and vague and the old rules don't apply, anymore.
 
Murphy
#8
It has been suggested that whatever comes into your home could be considered an import and taxed accordingly.

Free site or not, the government would tax according to what you did there and for how long. Accidentally stumbling onto a site wouldn't be taxed, but if you remained there for a period of time, or bought something from another country, a separate tax, other than the GST would be levied because you used the Internet and didn't buy Canadian.

There is a danger that "window shopping" in the US for example, could be taxed if you spent time there, or went back for repeat visits. I am not talking porn sites - although they would feel the taxman's bite too, no doubt - but clothing sites, tool sites, etc. Virtually any commercial enterprise.

What seems unfair or illogical to you or me would be examined by the government as a potential revenue stream.

Of course, that would trigger a huge rebirth of sites where you could subscribe to mask your activities from the government. Remember Newton's 3rd law? For every action, there is an equal, opposite reaction. Technology would be born to defeat the government tech.

Offshore companies offering the tech to Canadians would be difficult targets to hit.

 
Bar Sinister
#9
Quote: Originally Posted by Curious CdnView Post

What does "based" mean when a "Canadian site" might very well originate from a server in Latvia or the USA (and not very likely from Canada)?

If there is a tax, and there might not be considering the outcry against a similar idea in the US, it would be a simple matter of taxing the ISPs. Given that between home users and business users there are probably about 20 million subscribers in Canada, the tax would amount to about $25 a year or $2.00 and change a month.
 
Machjo
#10
Quote: Originally Posted by tayView Post

If you think your internet bill is already too high, then hold onto your hat, because it could be about to get even higher. Right now, Heritage Minister Mélanie Joly and Finance Minister Bill Morneau are reviewing a proposal to impose a new Internet Tax that, according to experts, would cost Canadian consumers at least $500 million a year.
A number of groups representing content producers, such as the Writers’ Guild of Canada and the Canadian Media Producers Association, are pressuring the federal government to implement this new tax as part of its sweeping investigation of how best to support Canadian culture in a digital age. The government wrapped up this review late last year, with Joly expected to publish initial proposals any day now.
The current system governing Canada’s cultural industries has not had a significant overhaul in decades, so while there’s little debate about the need for an update, controversy has been swirling about what form this update should take — zeroing in on the question of how and to what extent Canadian content should be publicly funded.
For Tyee readers familiar with OpenMedia’s work, it will come as no surprise that we’re strongly opposed to an internet tax, as are over 36,000 of our community members who

Quote has been trimmed, See full post: View Post
Fuk them!

You want us to watch Canadian content? Then make Canadian content that we'll watch. We watch mostly Chinese content at home and no internet tax will change that.
 
Bar Sinister
#11
Quote: Originally Posted by MachjoView Post

Fuk them!

You want us to watch Canadian content? Then make Canadian content that we'll watch. We watch mostly Chinese content at home and no internet tax will change that.

I don't think the tax is about watching Canadian content. It is about taxing ISPs to subsidize members of the Canadian entertainment industry whether you watch it or not.
 
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