AN ARGUMENT FOR CANADA'S ADOPTION OF A NETFLIX TAX SIMILAR TO THE SINGAPORE MODEL

Abstract

In this paper, I argue that Canada ought to adopt a similar set of Netflix tax VAT provisions to the Singapore model. In doing so, it ought to borrow from some of the features of the Quebec digital sales tax. Canada already has a Netflix tax that is completely non-functional. It should adopt a VAT to utilize the existing architecture. Additionally, a VAT is superior to a sales tax for compliance reasons, and it is superior to an income tax for political reasons. Implementing these reforms has the potential to unlock substantial revenues for Canada, and establish an important foothold in an ever-expanding and evolving tax base. Part I explains VAT cascading taxation. Part II provides an overview of the Singapore Netflix tax and the Quebec digital sales tax. Part III argues that Canada ought to adopt a Netflix tax similar in structure to Singapore, with some exceptions. Part IV explores relevant case law. Part V examines how the Netflix tax interacts with international agreements. Part VI compares the Netflix tax to a digital income tax. Part VII provides concluding remarks.