(Satiric AI illustration. The painting in the cabinet is from Toiletpaper by Cattelan and Ferrari)
September 16, 2026
For the moment, the American trade war launched against Canada feels like it’s in a lull.
Trump’s retaliation to Canada’s September 8th retaliation was modest (although that’s no consolation to Brampton’s auto workers).
Of course that could change in a heartbeat. No doubt the Prime Minister’s team has a ready list of “break glass in case of emergency” retaliatory measures, just in case.
It’s an opportunity to seriously consider a media policy proposed many times since Google and Facebook seized most of the Canadian ad market: legislating the extension of our Buy Canada tax deductions of advertising purchases from legacy media to also cover online media.
This idea, which goes by the moniker “close the loophole,” proposes to correct the omission of online advertising in sections 19, 19.01, and 19.1 of the Income Tax code, plugging a $2 billion hole in the corporate tax write-offs that Canadian companies are allowed when buying ads in foreign media like Google, Facebook, the online BBC, and the online New York Times.
Under the decades old tax code provisions as they stand, Canadian companies buying ads in legacy media only get the write off —-setting off advertising expenses against taxable revenues— if they buy ads in Canadian legacy media.
Here’s how the Canadian tax code works now:
- Section 19 says that only ads bought by Canadian companies in Canadian owned newspapers are eligible to be deducted from taxable income.
- Section 19.1 says that ads purchased in a “foreign broadcasting undertaking” aren’t eligible for set off either. In other words, only ad buys in Canadian broadcasting programs are eligible.
What’s not caught by those two provisions is “periodicals,” meaning print magazines. That’s done a little differently:
- Section 19.01 says that when Canadian companies buy ads in foreign magazines distributed in Canada they can only write off the expense if the magazine has at least 80% Canadian editorial content, i.e. written by a Canadian for the Canadian market only. If the magazine is less than 80% CanCon, the Canadian ad buyer can still deduct 50% of the cost.
The unique provisions for magazines is an outcome of a famous trade dispute between Canada and the US in the late 1990s. You can read MediaPolicy’s explainer here.
The argument in favour of extending these Buy Canada rules to online media has been made for many years by many advocates (including me when I was spokesperson for Unifor on media issues).
Forgive me for burying the lede, but the argument is being made again by a large group of Canadian publishers and broadcasters in a federal budget submission.
It appears to be a grass roots movement. The budget pitch was organized by Jim Barr of Seekers Media and Chuck Lapointe of Narcity. An online petition-style endorsement netted signatures from over big and small 50 news organizations, here.
What’s novel about their approach is the twinning of a close-the-loophole proposal with a federal ad voucher program —-partial cash reimbursement—- for Canadian businesses buying ads in legacy or online Canadian media, including news media.
The proposal scales the size of the voucher, a refundable tax credit for ad buys, ranging from 75% reimbursement for small Canadian companies to 30% for large. That puts an emphasis on local ad buying by Main Street retailers, less on national buys by big Canadian chains.
According to the pitch, the estimated $2.2 billion banked by the federal treasury after removing the write off for buying ads in Google and Facebook pays for the unspecified cost of the ad voucher program. “The net cost to the government is zero,” the submission says.
That’s a speculative costing, beyond the means of the media organizations who are advocating the trade-off and perhaps unknowable except to the Department of Finance.
Back in the spring, Senator Andrew Cardozo and I took a look at these issues in our report, Making News Media Sustainable.
On closing the section 19 loophole in favour of a Buy Canada ad purchasing tax policy for online media, we made three different proposals:
- Do nothing for now. We’re in a trade war and it’s a hand grenade.
- Do it now but support it with a government plan to grow online Canadian media platforms that can provide Canadian advertisers with a substitute for Google and Facebook.
- Do it the way it was done in 1998 for print magazines, which means continuing the write off for ad buys in foreign-owned media if their editorial policy is to publish and promote Canadian content.
This last point has policy potential as it plugs in directly to the CRTC’s order to US online undertakings like Netflix and Roku to make Canadian content more discoverable and visible on their platforms.
As for the ad buying voucher, the Senator and I advocated for what we called market facing support for news journalism. One proposal (only a single paragraph) suggested an ad voucher program. One of the merits cited was that ad purchases can be an effective proxy for public demand and choice of news publications.
***
If you would like regular notifications of future posts from MediaPolicy.ca you can follow this site by signing up under the Follow button in the bottom right corner of the home page;
or sign up for a free subscription to MediaPolicy.ca on Substack;
or follow @howardalaw on X or Howard Law on LinkedIn.
COMMENTS ARE WELCOME. But be advised they are public once I hit the “approve” button, so mark them private if you don’t want them approved.
I can be reached by e-mail at howard.law@bell.net.
This post is copyrighted by Howard Law, all rights reserved. 2026.
MediaPolicy.ca 