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Trudeau’s Digital Services Tax threatens taxpayers and the economy

Published

5 months ago

6 minute read

From the Canadian Taxpayers Federation

Author: Jay Goldberg

In other words, Trudeau is imposing a multi-billion-dollar tax on taxpayers – at a time when 50 per cent of Canadians say they’re $200 away from not being able to pay their bills.

Prime Minister Justin Trudeau managed to do two terrible things in one fell swoop: raise costs for Canadians at a time they can least afford it and risk a trade war with the United States.

The Trudeau government pushed its new Digital Services Tax through Parliament before quitting for the summer.

The government’s DST targets large foreign companies operating online marketplaces and social media platforms earning revenue from online advertising, such as Amazon, Facebook, Google and Airbnb. It is a three per cent tax on all revenue these companies generate in Canada.

Two red flags should pop up immediately for taxpayers. First, these companies won’t just eat the tax without passing costs onto consumers. And second, the United States government is sure to retaliate.

On the first point, there were clear signs that prices for Canadian consumers would increase because of this tax long before it was passed into law.

When the DST was in its proposal stage, the Parliamentary Budget Officer did an estimate of how much the government’s new tax would cost Canadians.

The PBO estimated the government’s DST would lead to an additional $7.2 billion in federal tax revenue over the next five years.

Where is that money coming from?

While major foreign companies will be the ones paying the tax directly, Canadian consumers will be hit with the bill.

It is “expected that businesses in the targeted sectors will adjust their services and prices in response to the new law,” the PBO said.

In other words, Trudeau is imposing a multi-billion-dollar tax on taxpayers – at a time when 50 per cent of Canadians say they’re $200 away from not being able to pay their bills.

Not only is Trudeau’s new DST going to increase costs for consumers, Canada also risks a trade war with the United States over the tax, which would cost Canadians even more.

In the wake of Trudeau’s DST getting through Parliament, the United States Trade Representative warned the U.S. will “do what’s necessary” to respond to the Trudeau’s new tax. USTR Katharine Tai warns she will look at “all available tools” as part of the U.S. response.

Tai’s isn’t the only voice in the U.S. calling for retaliatory action.

The Computer and Communications Industry Association, which represents tech companies like Amazon, Apple and Uber that will be targeted by Trudeau’s new tax, is calling on the Biden administration to fight back.

“With Canada’s DST now law, the time has come to announce [retaliatory] action,” said the association’s vice president, Jonathan McHale.

The president and CEO of the Tax Foundation is warning that U.S. retaliation would likely come through hiking tariffs on imports from Canada.

Given that the U.S. is by far Canada’s largest trading partner, making it more expensive to get Canadian goods into the American marketplace could have a detrimental impact on Canada’s economy, costing us both economic growth and jobs.

More than two years ago, the USTR warned against the Trudeau government taking measures that “single out American firms for taxation while effectively excluding national firms engaged in similar lines of business.”

But Trudeau chose to ignore those warnings and do exactly that.

To add insult to injury, the law authorizing the Trudeau government to bring the DST into effect (whenever it so chooses) allows it to do so retroactively, all the way back to 2022. Companies could be on the hook for huge sums for tax years in which the law didn’t even exist.

No wonder the Americans are threatening to fight back.

The bottom line is that Trudeau has put Canada in a terrible position. He is risking higher prices for Canadians and tariffs on our exports to the U.S. market, all in a lust for more cash. And the revenue the government is likely to bring in through the DST, an average of $1.4 billion a year, would be spent by this government in just one day.

It’s not too late for Trudeau to back down. Cabinet could choose not to bring the tax into force and avoid retaliation from the US.

For the good of taxpayers and the Canadian economy, Trudeau must abandon the DST.

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Bruce Dowbiggin

The Pathetic, Predictable Demise of Echo Journalism

Published on November 21, 2024

By

It can be safely said that the 2024 U.S. presidential election couldn’t have gone much worse for legacy media in that country. Their biases, conceits and outright falsehoods throughout the arduous years-long slog toward Nov. 5 were exposed that night. Resulting in the simultaneous disaster (for them) of Donald Trump winning a thunderous re-election and their predictive polling being shown to be Democratic propaganda.

Only a handful of non-establishment pollsters (Rasmussen, AtlasIntel) got Trump’s electoral college and overall vote correct. Example: One poll by Ann Selzer in Iowa—a highly-rated pollster with a supposedly strong record—showed a huge swing towards Harris in the final week of the election race, putting her three points up over Trump. He ended up winning Iowa by 13.2 points (Selzer now says she’s retiring.)

Throughout, these experts seemed incapable of finding half the voter pool. By putting their thumb on the scale during debates, the representatives of the so-called Tiffany networks and newspapers signalled abdication of their professional code. Their reliance on scandal-sheet stories was particularly glaring.

Just a few lowlights: “the brouhaha over a shock comedian at a Trump rally calling Puerto Rico “a floating island of garbage”. Unhinged outgoing POTUS Biden then called GOP voters “garbage”. So Trump made an appearance as a garbage man, to the snarky disapproval of CBS News chief anchor Nora O’Donnell.

Then there was Whoopi Goldberg on The View predicting Trump will “break up interracial marriages and redistribute the white spouses: “He’s going to deport and you, put the white guy with someone else… The man is out there!” Media ran with this one, too.

Worse, disinformation and lying reached such a proportion that Team Trump turned its campaign away from the networks and legacy papers down the stretch, creating a new information pathway of podcasts and social media sites (such as Joe Rogan, Theo Von and Adin Ross) that promise to be the preferred route for future candidates looking for non-traditional voters. A few prominent media owners sought to save themselves by refusing to endorse a presidential candidate, but the resulting tantrum by their Kamala-loving staff negated the effort.

In the past, poor performances by the Media Party might be dismissed or ignored. But the cataclysmic ratings drops for CNN and MSNBC paired with collapse in sales for blue-blood rags such as the New York Times, Washington Post and L.A. Times spoke to the public’s disgust with people they’ve always trusted to play it straight.

(Now Comcast has announced it’s spinning off MSNBC and its news bundle to save their profitable businesses. Staff members in these places are now panicking. As such the new administration promises to be indifferent to the former media powers-that-be as Trump mounts radical plans to recast the U.S. government. )

As noted here the disgraceful exercise in journalism was cheered on by their compatriots here in Canada. “In the hermetically sealed media world of Canada, natives take their cues from CNN and MSNBC talking points both of which employ Canadians in highly visible roles. (Here’s expat Ali Velshi famously describing on NBC that the 2020 George Floyd riots that burned for weeks— destroying billions in damages while resulting in multipole deaths— as “generally peaceful”.) 

The narratives of Russiagate, drinking bleach, “fine people” to Hunter Biden’s laptop— long ago debunked down south— are still approved wisdom in Canada’s chattering class. Especially if America’s conflagration election can be used to demonstrate the good sense and judgment of Canada’s managerial and media class.

The clincher for star-struck Canadians was the overwhelming Kamala love from the Hollywood crowd. Virtually every high-profile actor/ singer/ writer embraced the woman who was parachuted into the nomination in a coup— even as the same glitterati raved about anti-democratic Trump.  From Beyoncé to Bilie Eilish to Bruce Springsteen, their support was been a winner in Canada’s fangirl/ fanboy culture.”

Talk about backing a loser. Which leaves us asking what to expect from formerly respected media in the upcoming (it will come, won’t it?) defenestration of Justin Trudeau and Jagmeet Singh, probably in spring of 2025. One Toronto Star piece might provide a clue to the bunkered approach of Canada’s globalists. “Europe is leaving Donald Trump’s America behind. Should Canada do the same? As American democracy dives into darkness, Canada is facing difficult choices.”

CPC leader Pierre Poilievre has made it abundantly clear his thoughts on the bias of media. To save billions, he is making a major overhaul— even closure of CBC (not Radio Canada)— as a campaign pledge. He’s also said he will remove the slush fund now propping up failed establishment news organizations that employ unionized workers bent of crushing the Conservatives.

His scorn is obvious after watching media’s reverential treatment of Trudeau’s fake “murdered” Rez children stunt or the silence accompanying PMJT’s sacking of his indigenous Justice minister Jodie Wilson Raybould. Lately, a deadpan Poilievre humiliated a callow CBC reporter quoting “experts” by asking her “what experts?” Her unpreparedness leaves her floundering as Poilievre calls her question another “CBC smear job”.

Perhaps the classic Poilievre humbling of a reporter occurred in 2023 in a Kelowna apple orchard when a reporter seeking to score points with his Woke colleagues saw the bushwhack rebound on him. After numerous failed attempts at belling the cat, the local reporter played his ace card.

Question: Why should Canadians trust you with their vote, given … y’know … not, not just the sort of ideological inclination in terms of taking the page out of Donald Trump’s book, but, also —

Poilievre: (incredulous) What are you talking about? What page? What page? Can you gimme a page? Gimme the page. You keep saying that … “

No page was produced and the cringeworthy interview collapsed.

Needless to say, the reporter was absolved by his water-carrying colleagues. Here was Shannon Proudfoot of the Toronto Star: “Kicking a journalist in the shins over and over then turning the exchange into a social-media flex is telling on yourself…”  Venerable CBC panelist/ Star columnist Chantal Hébert  echoed the pauvre p’tit  take. “Agreed”.

For these press box placeholders it’s all too reminiscent of the acid-drenched style of former PM Stephen Harper, a stance that turned them to Trudeau cheerleaders in 2015. Which is to say we shouldn’t have high hopes for balance when the writ is finally dropped.

Poilievre has several more ministers (Melissa Lantsman, Garrett Genuis) skilled in exposing media imbalance, so we can expect full-blown pushback from the paid-for media from the usual suspects when Trudeau finally succumbs to reality. One drawback for the Conservatives could be the absence of national podcasters such as Rogan or Von to which they can pivot.

But make no mistake, However much Canada’s press corps denies it, the public has turned away from Mr Blackface and the politics of privilege. They’d best anticipate a rough ride ahead.

Bruce Dowbiggin @dowbboy is the editor of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. His new book Deal With It: The Trades That Stunned The NHL And Changed hockey is now available on Amazon. Inexact Science: The Six Most Compelling Draft Years In NHL History, his previous book with his son Evan, was voted the seventh-best professional hockey book of all time by bookauthority.org . His 2004 book Money Players was voted sixth best on the same list, and is available via brucedowbigginbooks.ca.

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Business

CBC’s business model is trapped in a very dark place

Published on November 21, 2024

By

The Audit

 

 David Clinton

I Testified Before a Senate Committee About the CBC

I recently testified before the Senate Committee for Transport and Communications. You can view that session here. Even though the official topic was CBC’s local programming in Ontario, everyone quickly shifted the discussion to CBC’s big-picture problems and how their existential struggles were urgent and immediate. The idea that deep and fundamental changes within the corporation were unavoidable seemed to enjoy complete agreement.

I’ll use this post as background to some of the points I raised during the hearing.

You might recall how my recent post on CBC funding described a corporation shedding audience share like dandruff while spending hundreds of millions of dollars producing drama and comedy programming few Canadians consume. There are so few viewers left that I suspect they’re now identified by first name rather than as a percentage of the population.

Since then I’ve learned a lot more about CBC performance and about the broadcast industry in general.

For instance, it’ll surprise exactly no one to learn that fewer Canadians get their audio from traditional radio broadcasters. But how steep is the decline? According to the CRTC’s Annual Highlights of the Broadcasting Sector 2022-2023, since 2015, “hours spent listening to traditional broadcasting has decreased at a CAGR of 4.8 percent”. CAGR, by the way, stands for compound annual growth rate.

Dropping 4.8 percent each year means audience numbers aren’t just “falling”; they’re not even “falling off the edge of a cliff”; they’re already close enough to the bottom of the cliff to smell the trees. Looking for context? Between English and French-language radio, the CBC spends around $240 million each year.

Those listeners aren’t just disappearing without a trace. the CRTC also tells us that Canadians are increasingly migrating to Digital Media Broadcasting Units (DMBUs) – with numbers growing by more than nine percent annually since 2015.

The CBC’s problem here is that they’re not a serious player in the DMBU world, so they’re simply losing digital listeners. For example, of the top 200 Spotify podcasts ranked by popularity in Canada, only four are from the CBC.

Another interesting data point I ran into related to that billion dollar plus annual parliamentary allocation CBC enjoys. It turns out that that’s not the whole story. You may recall how the government added another $42 million in their most recent budget.

But wait! That’s not all! Between CBC and SRC, the Canada Media Fund (CMF) ponied up another $97 million for fiscal 2023-2024 to cover specific programming production budgets.

Technically, Canada Media Fund grants target individual projects planned by independent production companies. But those projects are usually associated with the “envelope” of one of the big broadcasters – of which CBC is by far the largest. 2023-2024 CMF funding totaled $786 million, and CBC’s take was nearly double that of their nearest competitor (Bell).

But there’s more! Back in 2016, the federal budget included an extra $150 million each year as a “new investment in Canadian arts and culture”. It’s entirely possible that no one turned off the tap and that extra government cheque is still showing up each year in the CBC’s mailbox. There was also a $93 million item for infrastructure and technological upgrades back in the 2017-2018 fiscal year. Who knows whether that one wasn’t also carried over.

So CBC’s share of government funding keeps growing while its share of Canadian media consumers shrinks. How do you suppose that’ll end?

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