June 16, 2014 3:49 am

Taxpayers federation wants GST off digital entertainment downloads

A photo illustration of the legal download service iTunes and its film section on August 3, 2011 in London, England.

Matthew Lloyd/Getty Images

OTTAWA – The Canadian Taxpayers Federation says there should be no sales tax on digitally downloaded movies, TV shows and music.

The federation says it’s unfair that Canadian providers of digital entertainment are required to charge GST or HST, whereas their American competitors are not.

The federal goods and services tax adds five per cent to the cost of downloading from Canadian providers.

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The taxpayers federation says in provinces that have harmonized their sales taxes with the federal tax, the additional cost is as high as 15 per cent.

In a submission to a Finance Canada consultation panel on tax planning by multinational enterprises, the federation argues the GST and HST should be dropped on Canadian-provided digital entertainment.

It says the current situation gives an unfair competitive advantage to American providers, like Netflix and iTunes.

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