Liberals to pay for 35% of journalists’ salaries

This Liberal budget update states that they will be increasing the labour tax credit for newsrooms Liberals consider a “qualifying journalism organization.”

The Liberal government’s 2024 fiscal update shows that Canadian taxpayers will be doling out up to 35% of mainstream media journalists’ salaries for the next four years, which can be up to $30,000 per employee.

The budget update states that they will be increasing the labour tax credit for newsrooms they consider a “qualifying journalism organization.”

“The 2023 Fall Economic Statement proposes to increase the cap on labour expenditures per eligible newsroom employee from $55,000 to $85,000. It is further proposed that the Canadian journalism labour tax credit rate be temporarily increased from 25 per cent to 35 per cent for a period of four years,” the update reads.

Organizations will soon be able to claim up to $29,750 in labour costs per newsroom employee per year.

The report further estimates the cost would be $129 million to Canadians over the next five fiscal years, starting 2024-25.

Enormous concern about the independence of Canadian media

In response, the University of Ottawa’s Michael Geist stated in his blog that it raises “enormous concerns about the independence of Canadian media.”

“While the government claims this is being done to ensure a ‘strong and independent’ press, it is not hard to see how the opposite may be true,” Geist wrote.

“…now it finds that more than 1/3 of its labour costs for journalists are effectively paid by the government,” he added.

Tax credit increased due to the “changing nature of the news industry”

This 2024 fiscal update is in addition to the $600 million media bailout of 2019

The Trudeau government first introduced the labour tax credit in 2019, which was part of their $600 million media bailout announced just months before the 2019 Canadian election.

The decision comes on the heels of the Liberals’ Online News Act, which passed in June. The legislation requires tech giants like Google to pay news outlets for clicks that direct people to their platforms. In turn, Meta – the parent company of Facebook and Instagram – announced they would block Canadians’ access to news on their sites.

Google came close to blocking Canadians’ access to news on their platform as well, but they have delayed their decision for now.Tuesday’s announcement comes a few months after the former Liberal heritage minister, Pablo Rodriguez, hinted that he would be compensating mainstream media newsrooms for whatever losses they incur as a result of the tech giants’ response to their bill.

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