Canada comes out strong for its entertainment industry

As U.S productions wait with eager anticipation to hear if anticipated government bailout packages will ever materialize, BLAKE & WANG P.A Entertainment Lawyer Los Angeles sees positive news come from over the border. In what’s being billed as potentially the largest Canadian economic relief package the country has seen since WW2, the entertainment industry has not been forgotten and stands to receive strong support from funding programs. We take a closer look.

While the legislative process for the bill is (naturally) still ongoing, one aspect is clear- the plan requires international digi-tech companies (notably streamer Netflix) to remit federal sales tax on its digital sales. This- and further details- was revealed last Monday by the Canadian Finance Minister. Tourism, hospitality, the arts, and entertainment- all critically hard-hit industries in Canada- were all considered under the new legislation, slated to amount to about 3-4% of Canada’s GDP. Intriguingly, money has been greenlit for infection control, long-term care facilities, the widespread dissemination of COVID-19 vaccines, and income support for low and middle-class earners across all spectrums as well. As we’ve only recently seen tentative approval on 2 vaccines, it’s an interesting development to factor in. 

Highly Affected Sectors Credit Availability

The aid will be disseminated through this specific program, offering government-backed loans at reduced rates and with extended repayment terms of up to a decade. The idea is to keep employers employing and doors open throughout the arts until live audiences can recover. They will cover both live and digital events, and $181.5 million is earmarked to expand several key existing arts funding programs in the 2021-22 period alone. This could well have knock-on positive effects globally on how Canada is perceived as a location shooting venue. There’s also a slated increase in the Canadian Emergency Wage Subsidy, from 65% to 75% from December, and it’s set to continue through to March next year, no doubt to the relief of many.

Netflix and digital sales tax

While we’re still waiting for the complete details of all the offered reliefs, and while it will be a while before the bill, Bill C-10, is all finalized through the proper channels, it’s certainly promising news for the hard-hit Canadian entertainment industry. We can only hope to soon hear positive news on the U.S side of the border for similar industries, too. As the dust of the election settles and a sense of normalcy returns, hopefully, good news will be on the horizon for Americans as well.

While perhaps not the overall focus of this news, it’s also a fascinating development that the country will be asking digital streamers to remit federal sales tax, presumably as a bolstering measure for the relief programs in place. While it’s been slipped in as something of a footnote to the overall positive news surrounding these developments, it’s one that’s sure to draw some attention as we go forward. As always, your BLAKE & WANG P.A team will be here to keep you in the loop.