Quebec will attempt to impose a provincial sales tax on Netflix

With Netflix having avoided paying goods and services tax (GST), largely due to the backing of Prime Minister Justin Trudeau, the US-based streaming service now faces the potential imposition of a regional tax from the Quebec government.

Netflix signed an agreement with the national government whereby the firm has committed $500mn to the funding of new and original Canadian productions over the next five years, something that has helped the firm to remain exempt from paying GST.

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However, Quebec’s Finance Minister Carlos Leitao has since come out questioning the motivations behind this tax exemption:

“I find it very odd that the federal government would exempt one company from a tax that all companies should collect. We need to know why the federal government may exempt this one company: what kind of an agreement was reached with this company?”

“Once we have that, then we will be able to prepare a more effective strategy in our dealings with Netflix – and not just with Netflix, but with all of the businesses in this field.”

With many backing Leitao, a vote in the National Assembly on a motion that foreign web-based companies pay Quebec sales tax was passed unanimously.

The move is likely to further the political debate around the subject, with Trudeau having been avidly against introducing such a tax on a national level.