A single letter to a court did what two years of hearings, a tripled tax rate, and a trade dispute could not: it ended the CRTC's streaming levy. In a July 17, 2026 letter to the Federal Court of Appeal, Department of Justice counsel Michael Morris told the court plainly that "the Government's intention is to eliminate the base contribution requirement on streaming services and to provide government funding to replace those contributions." The disclosure, first reported publicly on July 28, closes the book not just on the CRTC's May 2026 hike to 15 percent but on the original 5 percent base contribution the regulator imposed back in 2024 — a requirement so contested it was stayed by the courts and never actually collected a dollar.
From 5 to 15 to zero in fourteen months
The policy's arc is its own indictment. In June 2024 the CRTC ordered large foreign streamers — Netflix, Amazon, Apple, Spotify, Disney+ — to put 5 percent of Canadian revenue into Canadian content funds under the Online Streaming Act. MPA-Canada and several platforms immediately challenged it at the Federal Court of Appeal, and the payments were stayed pending review. On May 21, 2026, instead of resolving that dispute, the CRTC tripled the ask: Broadcasting Regulatory Policy 2026-96 set the rate at 15 percent of Canadian broadcasting revenue for streamers clearing $25 million a year, while easing traditional broadcasters' obligations down to 25 percent from a prior 30-45 percent range. The CRTC projected this would "stabilize" Canadian and Indigenous content funding at more than $2 billion annually.
It lasted thirteen days. On June 3, Heritage Minister Marc Miller directed the CRTC to review its own decision, arguing the costs "could ultimately fall on Canadian consumers through higher prices," and pledged $600 million a year in direct federal funding to backstop the sector instead. The July court letter went further than that public statement, confirming the base requirement — not just the 15 percent increase — is being eliminated entirely.
The case for the levy, honestly stated
The strongest argument for the CRTC's approach was never really disputed by anyone in this fight: foreign streaming platforms now command a large and growing share of Canadian viewing and listening, and they contribute little to the domestic production ecosystem that traditional broadcasters have long been required to fund. Canadian producers, French-language broadcasters, and Official Language Minority Community programming genuinely depend on stable financing, and a revenue-based obligation tied to platforms actually operating in Canada is, in principle, a coherent way to fund that without drawing on general tax revenue. The Canadian Association of Broadcasters' Kevin Desjardins made this case directly: streamers that don't produce news themselves, he argued, should support it through contributions to funds. That's a defensible position, not a protectionist reflex.
Why the reversal is still the right call
But a mandate that never survives contact with reality isn't a policy — it's a standing invitation to litigation and trade friction. The 5 percent rule spent two years stayed in court without collecting a cent. The 15 percent hike arrived alongside pressure from the Motion Picture Association and, reportedly, the U.S. ambassador, turning a domestic cultural-funding question into a live irritant in the Canada-U.S. trade relationship at a moment Ottawa can least afford one. And regulatory mandates imposed on foreign firms operating in a market function, in practice, like a tax with no legislative vote behind it — routed instead through an independent regulator whose contribution formula changed three times in three years. Businesses, Canadian and foreign alike, cannot plan production slates or subscription pricing around a levy that triples overnight and then vanishes fourteen months later.
Direct government funding is more honest about who actually pays: taxpayers, not a disguised surcharge on foreign platforms that streaming services would likely have passed through to Canadian subscribers regardless. That's a real trade-off — the $600 million comes from the same consumers Ottawa says it's protecting — but it's a transparent, budget-line trade-off Parliament can scrutinize, rather than a rate set unilaterally by a regulator and then rewritten by cabinet under trade pressure.
Broadcasters aren't convinced the fix will actually land
What makes this moment more than a policy footnote is the skepticism now surfacing from the people the $600 million is supposed to reassure. Desjardins told reporters after the July letter that "the language in the letter does not align with what we have heard from the government, and we believe it would be premature to reach any definitive conclusions." By September 2, with streamers missing the scheduled August 31 Cancon payment deadline entirely, he said broadcasters had been told by the fund's administrator that "no new money will be coming in" — a direct contradiction of the swift-replacement narrative Ottawa offered in June. Bloc Québécois leader Yves-François Blanchet went further, calling the reversal a capitulation that lets foreign streamers operate "without contributing in any way to the development of our culture."
Both reactions are understandable, but they describe an execution problem, not a design flaw in scrapping the levy. As Michael Geist has argued, the CRTC's contribution framework was trying to graft 1968 Broadcasting Act mechanics onto internet platforms, and the unresolved questions — who's eligible for funding, who owns the rights to what gets produced, how foreign streamers actually access Canadian funds — were never solved by simply raising the percentage. A genuine reset, done through the promised new policy direction with real consultation, is a better foundation than a litigated mandate nobody could actually collect. Ottawa's obligation now is to move fast enough that "reset" doesn't become a euphemism for indefinite delay.