Politico | 26 May 2026
Streaming tax clouds USMCA review
By ARI HAWKINS
NEW RULES: The Trump administration is sharpening its criticism of Canada’s new content spending rules for streaming companies after Hollywood studios and U.S. industry groups pushed Washington to treat the move as a trade issue ahead of USMCA talks.
Context: Canada’s broadcasting regulator, the Canadian Radio-television and Telecommunications Commission, on Thursday ordered streaming companies that make more than roughly $18 million a year in Canada to devote 15 percent of that revenue to Canadian and Indigenous television programming, up sharply from the 5 percent contribution introduced in 2024.
The Canadian regulator’s “decision to triple the tax rate on leading streaming services is making a bad situation worse,” Peter Hoekstra, the U.S. ambassador to Canada, wrote on X. “CRTC is targeting and taxing U.S. companies, putting up new, discriminatory trade barriers, and worsening the investment climate for American businesses.”
The irritant comes at a delicate moment for U.S.-Canadian relations, weeks before the start of the first phase of the USMCA review on July 1, which officials including U.S. Trade Representative Jamieson Greer frame as more challenging with Canada than with Mexico.
Trump administration officials have kept the status of negotiations with Canada closely held while projecting a hard line publicly, insisting the trade pact could still be split into two separate agreements with Canada and Mexico despite skepticism from some Republican lawmakers that the United States would actually blow up the deal.
More details: The CRTC also introduced new requirements that will force foreign streaming companies to make Canadian, Indigenous, French-language and minority-language television easier to find on their platforms and apps.
The new rules fall under the Liberal government’s controversial Online Streaming Act, which is meant to even the playing field between foreign online streamers and Canadian broadcasters.
Large online streaming companies that make more than roughly $73 million in Canada will face extra rules, including having to put some of their revenue toward French-language programming. The CRTC said about 10 companies meet that threshold, but it did not name them, citing confidential financial information.
It’s unclear when the new rules will come into effect, but the CRTC said it will soon begin to work with affected companies on the framework.
More pushback: American lobbying and industry groups across the tech and entertainment sectors were the first to blast the decision, urging the Trump administration to prioritize the issue as part of the USMCA review.
The Motion Picture Association, which represents companies including Paramount, Amazon, Netflix and Disney, said it “strongly condemns” the move in a statement from Chair and CEO Charles Rivkin, arguing the fees “directly violate” Canada’s obligations under the USMCA.
“This decision triples the cost of doing business in Canada and will spark even more inflation in the market, making further investment and innovation less attractive,” Rivkin said.
“We urge the Trump administration to make this issue a priority, and we call on the Canadian Government to repeal the Online Streaming Act,” added Brad Wood, senior director for trade and innovation policy at the National Foreign Trade Council, which represents leading exporters and importers and counts Walmart, Visa and the Ford Motor Co. among its board members.
