Canadians may soon be able to write off some of the cost of subscribing to digital news outlets.
Finance Minister Bill Morneau unveiled measures worth a projected $595 million over five years to support the struggling journalism industry during his fall fiscal outlook on Wednesday afternoon.
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Newsrooms have been hit hard by a decline in advertising revenue in recent years as digital ad dollars increasingly go to giants like Google and Facebook.
That has led to significant and repeated layoffs over the past decade in Canadian newsrooms, leaving many struggling to provide coverage of a wide swath of issues.
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“We’re encouraged by the federal government’s recognition of the difficult news revenue landscape for many media companies in Canada” said Ron Waksman, Vice-President of National and Network News for Global News. “As a leading innovator in digital and broadcast news, we’ll be studying the measures outlined by the Minister with an eye to continuing to provide Canadians with trusted, original, local and national news because journalism matters now more than ever.”
In an effort to encourage Canadians to buy the subscriptions that keep many newsrooms afloat, the government plans to introduce a temporary tax credit in Budget 2019.
That would let Canadians write off 15 per cent of the cost of a subscription to “eligible digital news media.”
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As well, a tax credit would also be offered to news organizations to “support the labour costs associated with producing original news content.”
The latter will be available to both non-profit and for-profit news organizations, and comes as the government also plans to introduce a new category to let non-profit journalism organizations qualify as charities and issue tax receipts to donors.
But exactly which organizations will be allowed to qualify for all of the new measures remains unclear.
In order to determine which organizations should be eligible for the tax credits for the cost of labour, “an independent panel will be established from the news and journalism community.”
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Finance officials said on Wednesday the goal will be to have people on that panel who have actually worked in journalism.
However, they would not rule out that it could also include corporate executives from media organizations who do not actually work as journalists themselves.
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The Conservatives have already been critical of the Liberals for doing anything for the media industry, accusing them in recent days of using money to curry favour with journalists ahead of the next election.
“It would be unacceptable for the Liberals to even appear to be trying to influence favour with the media,” said Conservative MP Peter Kent, who is himself a former journalist.
The Conservatives also are critical of the political plans of Unifor, Canada’s largest private-sector union, which represents workers at several media organizations. Unifor has launched a plan to campaign against the Conservatives leading up to the next federal election and several Conservatives have argued this strategy calls into question the independence of journalists represented by the union.
— With files from the Canadian Press
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