More Free Money: Media Lobby Campaigning For Even More Government Funding, Grants and Tax Reform
The addiction to government funding and regulation has come at an enormous cost that erodes public trust and created dependence on the very governments the press is supposed to hold to account.
The proverbial ink is barely dry on the disastrous Bill C-18, yet the Canadian media lobby has already moved onto the next targets for government funding, grants, and tax reform. The effort, which is seemingly designed to ensure that government funding or regulation cover the entire cost of news, focuses on extending grants, expanding provincial tax credits, and overhauling the tax treatment of ad spending. It has hard to overstate how dangerous these policies have become as the sector’s addiction to government funding and regulation has come at an enormous cost that erodes public trust and created dependence on the very governments the press is supposed to hold to account.
The slippery slope of this government’s funding the media has been ongoing for years: the Local Journalism Initiative offered tens of millions in grant money, the Labour Journalism Tax Credit created a tax credit worth nearly $14,000 per journalist when established that was more than doubled last year on a retroactive basis to nearly $30,000 per journalist, and the Online News Act (Bill C-18) offered the hope (or more accurately illusion) of hundreds of millions more from Google and Meta. On top of the federal money, the Quebec government offers a similar tax credit system that comes close to ensuring that government money and regulation cover the entire cost of news journalists at print and digital publications in the province. And if that were not enough, the CRTC is working through its plan for Bill C-11, which the Canadian Association of Broadcasters hopes will lead to the creation of yet another news fund, with 30% of contributions from Internet streaming services such as Netflix and Disney going to the news divisions of Canadian broadcasters such as Bell and Rogers.
Yet despite the hundreds of millions in support – which the sector pledged would be temporary – it appears the only thing these policies bring are demands for more. With the Labour Journalism Tax Credited both extended and expanded in last year’s Fall Economic Statement, the sector has turned to the Local Journalism Initiative in the hope that it too will be extended. Further, the lobbying to expand the Quebec labour journalism tax credit to other provinces is in full swing with B.C. the first target. If adopted, the independence of the press would be placed further at risk given the combination of federal and provincial tax credits – combined with Google money – could result in public money and regulations covering the full cost of news journalists.
In addition to the tax credits and granting programs, the lobby has also set its sights on tax reform, namely the removal of tax deductions for advertising on foreign digital platforms. The tax deduction policy dates back decades and Canadian publishers and broadcasters would like the foreign platforms removed, effectively making it more expensive to advertise on those platforms when compared to advertising on Canadian services that would still qualify for the preferential tax treatment (in fact, some are even calling for tax credits for advertising on Canadian services). Misleadingly referred to by some MPs as a billion dollar subsidy to the platforms, the reality is that changing the tax treatment would be unlikely to dramatically shift ad dollars to Canadian publications since advertisers typically seek out effective ads, not necessarily cheap ones. Instead, the primary impact would be to make advertising on foreign platforms more expensive for Canadian businesses, leading to increased costs that are invariably passed along to consumers.Not only would the policy change raise cost issues for Canadian businesses, but it is likely to spark a trade challenge under the USMCA since it would specifically target non-Canadian service providers and advertising is not covered by the cultural exemption.
While the government should be thinking about policies to address the challenges faced by the media sector, it is time to recognize that caving to media lobby demands over the past five years for a seemingly endless array of tax credits, grants or other programs has done far more harm than good. It has undermined trust in the media, extended the life of some businesses that probably should be allowed to die if no longer commercially viable, and created barriers to newer, innovative services that provide real hope for the future.
Post originally appeared at https://www.michaelgeist.ca/2024/02/more-free-money-media-lobby-campaigning-for-even-more-government-funding-grants-and-tax-reform/
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Unbelievable, no wonder the media is so bias and left leaning, they are paid off by the liberal government.
Media's increasing dependence on excessive government funding can only be described as a bribe.
This ensures that Mockingbird media will never be in a position to reveal the aggressive global push into the video game (simulation) which is premised on the crimes of warrantless search and seizure (including at the cellular level) using the Internet of Nano Things and the WBAN (Wireless Body Area Network IEEE802.15.6 in the Terahertz Band.)
https://youtu.be/Jf4QC1tFPCQ?si=JwHWLRNGTD8eUIfD