OCNA, Vietnamese paper say Liberal govt’s ‘unfair tax’ will hurt ethnic print media

January 26, 2015

Say NO to unfair taxation!

By Dat Nguyen

Publisher, Thoi Bao Newspaper, and CEMA Director

Community newspapers are the lifeblood of Canada. They present hometown news no one else will publish. They reach out to 5.8 million Ontarians, including many new immigrants who first learn about their city and province through newspapers published in their own language.

But in Ontario today, many community newspapers are under attack by a regulatory loophole that is unfair to many publishers.

Ontario charges 8% provincial sales tax (PST) on most retail goods. Under the Retail Sales Tax Act, newspapers are included in the examples of the most common goods that are not taxable. Because of the key role they play in society, Ontario exempt newspapers from PST. They don’t pay PST for their supplies such as printing.

But in its attempts to tighten up tax laws, the Ontario government has defined many local newspapers as magazines which are taxable publications. That basically increases their costs by 8%.

Heres the problem: Ontario defined a newspaper as a publication that is issued at least once a week if it is unbound and at least five times a week if it is bound. That means that if your newspaper comes out say, every two weeks, or if a weekly paper is stapled for your convenience, the province says it is no longer a newspaper and no longer worthy of PST exemption.

This is simply a question about fairness in taxation. If a weekly newspaper is stitched, it is taxable. If a weekly newspaper is unstitched, it is tax free, even thought they both may carry the same content and serve the same community.

To make matters worse, provincial auditors are going through publishers accounts and charging back taxes that can total hundreds of thousands of dollars!

The Ontario Community Newspapers Association (OCNA) estimates this ruling will affect more than 50 community newspapers. That includes publications that serve Arab, Chinese, Dutch, German, Russian, South Asian, Vietnamese and many other communities, as well as some English-language papers.

As community publishers suffer, more than one million readers throughout Ontario will be affected. Many newspapers will cut back on editorial and production which means less reporting and fewer articles and photos. Other newspapers will find it harder to grow and some could fail outright.

Community publishers who play an essential role in serving and informing their audiences believe they deserve the fair treatment among all newspaper publishers.

There are alternatives. The OCNA has developed a simple formula based on a regulation defined and used by the Canadian Heritage Department of the Federal Government that would protect legitimate newspapers from inequitable taxation The Canadian Heritage Department has a better process of defining magazines and newspapers which include many factors such as format, binding, cover, content etc.. and not just by the binding alone.

The Ontario government is currently looking at this issue to see if they can develop a fair tax policy on this issue.

Most politicians say they support easing the burden on community newspapers. But they need to be convinced to act now, before some publishers go under.

If you believe in healthy community newspapers, you can help.

Please contact your local Member of Provincial Parliament (MPP) and let them know that charging PST on some newspapers and not others is unfair and endangers the flow of information in many communities.

Please point out to your local MPP that:

It is unfair to tax a weekly newspaper simply because it is stitched and then no tax on the unstitched weekly newspaper; and

It is unfair to back dated and put a burden of taxation over 5 years on the community publishers which may put them out of business.

Ontario needs a healthy community press. In return, community newspapers ask only for fair treatment.

For more on the OCNA campaign, please call Gordon Cameron, Government Relations Associate, at (905) 639-8720 ext. 239. The OCNA has all the information you need to fight this arbitrary, unfair tax. Or e-mail Dat Nguyen,[email protected]