Quebec Finance Minister Carlos Leitao arrives for a dinner meeting with Federal Finance Minister Bill Morneau and his provincial and territorial counterparts, in Ottawa, Sunday, June 18, 2017. Leitao tells reporters he has sent a letter to his federal counterpart, Bill Morneau, and has invited the Liberal government to rethink its position to not tax the online-streaming service. THE CANADIAN PRESS/Fred Chartrand
Republished November 08, 2017 - 2:20 PM
Original Publication Date November 08, 2017 - 10:36 AM
OTTAWA - 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.
"Our sales taxes have to apply to the realities of the 21st century," Carlos Leitao wrote in the letter dated Tuesday to Bill Morneau.
Calling it a matter of "fairness," Leitao said "Quebec will have no choice but to act alone" if the federal government doesn't budge.
An agreement Ottawa has reached with Netflix allows the U.S. web-streaming giant to forgo paying sales tax by investing $500 million in Canadian productions over the next five years.
Leitao says the deal gives Netflix an unfair advantage over Quebec-based companies that offer similar services.
Quebec's position did nothing to sway Morneau.
"We have been clear — our government has no plans to introduce a new tax on middle class Canadians,", his spokeswoman, Chloe Luciani-Girouard, wrote in an email Wednesday.
"Should (Quebec) determine they want to move forward on imposing a sales tax on Netflix, they can proceed."
In Quebec City, Leitao told reporters he doesn't require Ottawa's permission to proceed but that he still needed to inform the federal government because the province's sales tax is harmonized with the federal GST.
Leitao said his government has been given indications by the company it is willing to pay taxes to the province.
"(Netflix) is telling us, very honestly and clearly, that they will co-operate," he said.
A spokesperson for Netflix said in an email, "Netflix pays all taxes where required by law."
Leitao intends to introduce the measure as of 2018.
Last month, all Quebec political parties voted unanimously in favour of a motion to ensure the provincial sales tax is quickly imposed on all foreign companies that offer products and services online, notably in the cultural sector.
News from © The Canadian Press, 2017