Poll: Vast majority of Canadians oppose Internet Tax, prefer funding CanCon by extending GST/HST to foreign online companies

Innovative Research Group poll finds 70% of Canadians are opposed to an Internet Tax to fund Canadian Content, including 63% of Liberal Party supporters

February 6, 2017– Canadians are strongly opposed to plans to create a new Internet Tax to fund Canadian content, an idea currently under review by Heritage Minister Melanie Joly and Finance Minister Bill Morneau. An Innovative Research Group (INNOVATIVE) poll found that 70% of Canadians oppose an Internet Tax, with just 14% in support. Federal Liberal supporters are against an Internet Tax by 63% to 19%.

With the results of the government’s #DigiCanCon review expected any day now, neither Ministers Morneau or Joly have ruled out the idea of an Internet tax. Groups such as the Canadian Media Producers Association and Writers Guild of Canada have been pushing the Internet Tax, which could cost Canadian taxpayers as much as $500 million a year.

The idea sparked criticism from experts and Indigenous advocates, who say the cost will be passed onto Internet users – deepening Canada’s digital divide and keeping low-income Canadians offline. The Innovative Research Group poll also found that Canadians support the alternative of extending GST/HST to foreign online companies by 47% to 29%.

“It’s official: Canadians overwhelmingly oppose the idea of an Internet Tax, and want the government to look at alternatives,” said Josh Tabish, campaigns director for OpenMedia. “In her comments on Thursday, Minister Joly deflected questions about the Internet Tax to Finance Minister Morneau, who, despite our invitation, has so far failed to meet with us to discuss the matter.”

Tabish continued: “The CRTC just ruled that access to mobile and fixed Internet is a basic service for all Canadians. And with 1-in-5 Canadians offline – due in large part because of high prices – we simply cannot afford new fees that will increase our monthly bills. The government needs to rule out the Internet Tax and focus its efforts on lowering the cost of Internet access.”

KEY FINDINGS of the Innovative Research Group poll include:

• Canadians support the federal government creating a new revenue source to provide dedicated public funding for the production of Canadian content by 53% to 20%.

  • Liberal Party supporters are 66% to 10% in favour of this proposal.

• Canadians oppose an Internet Tax to fund the production of Canadian content by 70% to 14%, with 51% strongly opposing the idea.

  • Liberal Party supporters are against an Internet tax by 63% to 19%.

• Canadians broadly support the alternative of funding Canadian content by extending GST/HST to foreign online companies operating in Canada by 47% to 29%.

  • Liberal Party supporters are in favour of this alternative by 60% to 21%.

• Even those in favour of creating a new revenue source for CanCon are against the Internet tax by 56% to 24%. However this group strongly supports extending GST/HST to foreign online companies by 67% to 14%.

• The results are broadly consistent across French-speakers and English-speakers, with the exception of support for extending GST/HST. French-speakers support this by 39% to 34%, compared to English-speakers who back the proposal by 49% to 28%.

The government is currently considering a broad range of options to fund Canadian content in a digital age, including:

• Closing Sales Tax loopholes: This would ensure that foreign digital services (such as Netflix) collect and remit sales taxes (GST/HST), as Canadian digital vendors are already required to do. Note: this is not the same as a “Netflix Tax” (see below).

• The Internet Tax: A new fee that would be imposed onto the monthly bills of Canada’s Internet subscribers to promote Canadian culture in the 21st century. This would force Internet prices to go up and keep even more Canadians offline.

• The Netflix Tax: A CanCon-specific levy imposed on over-the-top (OTT) streaming video services such as Netflix. Imposing a new tax for online streaming content companies would be inappropriate given the advantages vertically-integrated telecom giants – companies that both own communications infrastructure, as well as content empires, like TV stations and magazines – have over providers such as Netflix. Such a tax would favour Big Telecom and stifle new delivery platforms – exactly the opposite of what Canadians are calling for.

Over 31,000 Canadians have signed an OpenMedia petition asking Minister Joly to reject the idea of an Internet Tax.