Link Tax in Canada: What is it and how does it matter to ex-pats?
The link tax is one of the most controversial proposals recently furnished by the Canadian Government. It is modeled after the Australian tax system to support new channels. On their official website, Canada Government clarifies that this is a noble initiative to save the Canadian ‘news ecosystem’. The law has created a huge uproar and you must know everything about it if you are running a digital platform with a strong Canadian presence. Contact the best tax consultants in Toronto for a clearer idea of the bill.
It is true that the news portals and newsrooms require financial support to strengthen their infrastructure. The link tax will raise a decent fund that goes directly to the news channels. But how does that work? Let’s see the link tax at a glance.
Link tax at a Glance
According to the link tax, digital platforms such as Facebook and Google need to pay a certain amount as the ‘copyright fee’ each time a link from them shows up on a news channel. Let’s put it simply like this:
- XYZ News is a 24-by-7 Canadian news channel where Google displays a link to a news article. Now, as per the new link tax, Google is entitled to pay the respective news outlet a ‘copyright fee’ for the display of the link.
- Another example would be SEO hyperlinks which are typically used to replace long and illegible (from a layman’s perspective) URLs. Digital platforms often use SEO links to help users navigate more seamlessly.
- Let’s say you are browsing through an article on new car models and you come across a hyperlink that takes you straight to the official page of the carmaker. Wouldn’t you appreciate that? It saves your time and effort, right? However, the link tax levies a toll on such SEO hyperlinks that Google or Facebook often use.
How does link tax affect ex-pats?
This is quite a concern for the ex-pats, especially those who have a major online presence in Canada. If you have a digital platform and you display links on various news portals to draw potential clients or customers to your business, you should be aware of the new law. Moreover, the law does not define clearly the eligibility to become a prospective news outlet to whom big digital platforms need to pay.
The thing is that if you are a digital platform owner and want to display certain links for business purposes, you have to pay up to the news portal. There will be no government intervention. The ‘copyright fee’ goes straight to the news outlets where the links are displayed.
The link tax was tried in Germany and Spain, but the outcomes were not so positive. Currently, France and Australia are rolling out the link tax. However, experts claim that it won’t be beneficial for them either. There are many volatile areas and that’s why you must get in touch with an international tax consultancy service in Toronto.
