Prime Minister Mark Carney says Ottawa’s decision to scrap a levy on large foreign streaming services was done to help Canadian consumers, denying that it was due to pressure from the Trump administration.
Canada’s federal regulator imposed a 5 percent levy on major streaming services in 2024 and raised it to 15 percent in May of this year, requiring that they spend 15 percent of revenue earned in Canada on Canadian programming and related funding.
Last month, Ottawa opted to replace the streaming contribution requirements with $600 million a year in government funding, in the wake of concerns that the 15 percent levy could increase streaming costs and amid ongoing criticism from the Trump administration, which is set to impose 50 percent tariffs on about $28 billion in Canadian goods on Aug. 19.
“We made that decision with a focus on affordability right out of the gate,” Carney said in response to questions during an unrelated press conference July 29 in Red Deer, Alta.
“Most Canadians have one or two or so of these streamers,” he said. “This stuff adds up, and there’s a better way to do it.”
The Trump administration said the levy was an unfair trade barrier targeting American companies and cited it as one of the reasons for its ongoing trade dispute with Canada.
The levy is still in place as Ottawa prepares directives to order the Canadian Radio-television and Telecommunications Commission (CRTC) to remove it.
Plans to Eliminate Levy
The attorney general’s office said in a July 17 court document that it plans to eliminate the financial contribution requirement for streamers and will send a new policy directive to the CRTC in the coming weeks.
However, the Canadian Association of Broadcasters said July 29 that they have not had this confirmed.
“The language in the letter does not align with what we have heard from the government, and we believe it would be premature to reach any definitive conclusions from this administrative communication between the Court and one of the respondents,” association president Kevin Desjardins said in a statement.
Ottawa’s decision to remove the 15 percent streaming levy comes in the wake of a decision last year to also scrap the Digital Services Tax, which put a 3 percent charge on some Canadian revenues earned by large digital companies.
Ottawa cancelled the tax just before the first payments were due in June 2025 and moved to repeal it retroactively as the Trump said he was ending trade talks with Canada over the new tax.
Carney’s Response
Carney said at his July 29 press conference that the decision to to remove the streaming tax was made shortly after the CRTC imposed the new higher 15 percent Canadian-programming requirement on May 21 and was “not at all” because of U.S. pressure.
“We decided right after the CRTC decision, and like I said before, the federal government will focus on affordability. We understand that there have been a lot of increases for streamers,” Carney said.
“Right now, there’s a process in place. The CRTC will receive some directives over the next few weeks, so this is not a new announcement,” he added, noting that the roughly $600 million in funding will also help “strengthen Canadian culture as well as the French language.”
The prime minister went on to cite overall affordability pressures facing Canadians, including references to the cost of groceries, energy, and housing.
Conservative Leader Pierre Poilievre had criticized the CRTC’s decision to raise the streaming levy to 15 percent this past May, calling it a “Netflix tax hike” and saying it would increase costs for those who subscribe to services like Netflix and Spotify.
“Conservatives oppose the Liberal ‘Netflix tax,’ and I’m asking you to reverse this tax hike,” Poilievre wrote in a May 2026 letter, saying the move would make the country “more expensive, less predictable and harder to do business in.”
Despite having labeled the 15 percent levy as a trade irritant, the U.S. Trade Representative Jamieson Greer recently said that Canada won’t “really get credit” for reversing it.
While Poilievre has called for the levy to be scrapped, he has also repeatedly accused Carney of making concessions to U.S. President Donald Trump despite Carney having campaigned on an “elbows up” approach to American tariffs and economic threats.
