Que­becor boss calls on Ot­tawa to end favouritism to­ward for­eign com­pa­nies

Montreal Gazette - - CITY - JA­COB SEREBRIN

Que­becor pres­i­dent and CEO Pierre Karl Péladeau railed against what he de­scribed as an un­fair sys­tem of tax­a­tion, which priv­i­leges for­eign com­pa­nies at the ex­pense of those based in Que­bec, in a speech to the Cham­bre de com­merce du Mon­tréal métropoli­tain on Tues­day.

Péladeau said it’s “com­pletely ridicu­lous” that com­pa­nies like Net­flix and Ama­zon don’t have the same obli­ga­tion to charge their cus­tomers sales tax that lo­cal com­pa­nies do.

In Septem­ber, Net­flix reached a deal with the fed­eral gov­ern­ment that will al­low it to con­tinue not charg­ing fed­eral sales tax to Cana­dian cus­tomers in ex­change for a prom­ise to spend $500 mil­lion on Cana­dian pro­gram­ming.

“The Trudeau gov­ern­ment failed com­pletely in favour­ing a for­eign group,” he said.

In­stead, he said, the gov­ern­ment should be en­cour­ag­ing lo­cal com­pa­nies to ex­pand in­ter­na­tion­ally.

The provin­cial gov­ern­ment has said it plans to re­quire all com­pa­nies with sig­nif­i­cant sales in Que­bec to start charg­ing provin­cial sales tax to cus­tomers. Cur­rently, only sell­ers with op­er­a­tions in the prov­ince are re­quired to charge provin­cial sales tax.

The for­mer leader of the Parti Québé­cois told re­porters af­ter his speech that re­quir­ing all sell­ers to charge sales tax was a good re­sponse, though per­haps com­ing too late, and he de­plored the lack of tan­gi­ble steps taken by the prov­ince.

Péladeau said he de­cided to sell mu­sic re­tailer Ar­cham­bault in 2015 be­cause Ama­zon was able to sell in Que­bec with­out hav­ing to charge sales tax.

Péladeau spent much of his speech talk­ing about Que­becor’s sup­port for arts and cul­ture in Que­bec and said there was a ben­e­fit in hav­ing com­pa­nies based in the prov­ince cre­at­ing me­dia to be con­sumed here.

In­stead of giv­ing for­eign com­pa­nies pref­er­en­tial treat­ment, there should be a fo­cus on cre­at­ing na­tional cham­pi­ons, con­sid­er­ing all the tal­ent in Que­bec, he said.

Péladeau also used his speech to crit­i­cize the “reg­u­la­tory bur­den” that he said is pre­vent­ing the com­pany from in­no­vat­ing.

With a slide show­ing a pair of hand­cuffs be­hind him, he specif­i­cally crit­i­cized a CRTC de­ci­sion that forced the com­pany to stop of­fer­ing cus­tomers who sub­scribed to “premium” cell­phone plans un­lim­ited stream­ing mu­sic sep­a­rate from their reg­u­lar data al­lot­ment.

The CRTC ruled the of­fer­ing vi­o­lated net neu­tral­ity reg­u­la­tions, which re­quire all in­ter­net traf­fic be treated the same.

“When we launch prod­ucts, we should try to cel­e­brate the courage and vi­sion of our busi­nesses rather than shut­ting down these ini­tia­tives,” he said.

We should try to cel­e­brate the courage and vi­sion of our busi­nesses rather than shut­ting down these ini­tia­tives.

JOHN MAHONEY

Que­becor pres­i­dent and CEO Pierre Karl Péladeau says it’s “com­pletely ridicu­lous” that for­eign com­pa­nies don’t have to charge their cus­tomers sales tax when lo­cal busi­nesses are re­quired to do so.

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