Economy

Quebec will impose tax on Netflix in early 2018

Quebec will impose tax on Netflix in early 2018”

Quebec will forge ahead with plans to tax Netflix with or without the support of Ottawa, the province's finance minister has said in a letter to his federal counterpart.

Quebec charges sales tax at a rate of 9.975 percent, while the federal rate is 5 percent.

In September, Ottawa announced a deal in which Netflix would spend C$500 million ($393 million) over five years to create Canadian content, with C$25 million earmarked specifically for French-language content.

The finance minister of the mostly French-speaking province wrote to his federal counterpart on Tuesday to formally inform him of the decision, according to La Presse.

Leitao says the deal gives Netflix an unfair advantage over Quebec-based companies that offer similar services.

After the federal deal with Netflix was announced, Leitao said that he thought it odd that Ottawa would exempt a company from paying a tax that all companies are expected to collect.

Leitao intends to introduce the measure as of 2018.

In early October, the National Assembly voted unanimously in favour of a motion demanding that all foreign web-based companies collect QST from their customers.

The idea of a Netflix tax first emerged before the last federal election, when Stephen Harper warned that Canadians needed to vote Conservative or face a tax on the use of the streaming service. "Therefore any change, even an administrative change, because that's what it will be, an administrative change, the other government needs to be informed, so that's what we are doing", said Leitao.

A spokesperson for Netflix said in an email, "Netflix pays all taxes where required by law".



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