Question Period Note: Federal Support for Journalistic Content

The Fall Economic Statement 2023 announced an additional $129 million of tax credits over five years to support a strong and independent press.
The Journalism Labour Tax Credit will undergo two modifications: firstly, raising the cap on labor expenditures per eligible newsroom employee from $55,000 to $85,000, and secondly, increasing the rate from 25 to 35 per cent for a four-year period, allowing organizations to claim up to $29,750 per eligible employee.

• A free and independent press plays a vital role in fostering an informed citizenry and functions as the cornerstone of any healthy democracy.

• The Government has consistently supported news organizations through tax measures, the Canada Periodical Fund and the Local Journalism Initiative.

• The Government will continue to support Canada’s news sector through this time of disruption.

Local Journalism Initiative (LJI) and the Canada Periodical Fund (CPF)
• The Local Journalism Initiative (LJI) supports the creation of original civic journalism that covers the diverse needs of Canada's underserved communities has resulted in the hiring, or maintaining levels, in employment of 448 journalists in 2021-22. Collectively they offered journalistic coverage to 1,544 underserved communities in Canada, of which 47 journalists provided coverage for Indigenous communities, 66 for ethnocultural communities, 206 for official-language minority communities and 2 for 2SLGBTQ+.
• To further support local journalism for underserved communities, Budget 2022 allocated an additional $10 million in 2023-24 for LJI. LJI is sunsetting in March 2024.
• The Canada Periodical Fund (CPF) provides financial assistance to Canadian magazines, non-daily newspapers and digital periodicals to enable them to overcome market disadvantages and continue to provide Canadian readers with the content they choose to read. The program has four components: Aid to Publishers, Business Innovation, Collective Initiatives and Special Measures for Journalism. The bulk of funding is distributed through the Aid to Publishers component, which uses a funding formula based on circulation.
• Budget 2022 provided $40 million in funding under the CPF to renew Special Measures for Journalism for three years and temporarily increase Business Innovation stream.

COVID-19 Emergency & Recovery support for journalism
• The Government offered additional support to magazines and community newspapers during the COVID-19 pandemic.
o Budget 2021 increased the budget of the LJI program by $10 million over two years, with at least 60 percent of this funding reserved for groups that are often underrepresented in the media (e.g., Indigenous, ethnocultural and official-language minority communities).
o Through the Aid to Publishers component of the CPF, existing magazine and community newspaper clients received a $15.4 million top-up in 2020-21 and $10 million in 2021-22 which was provided to 571 and 754 recipients respectively.
o Also, via the Special Measures for Journalism component of the CPF, the Government provided $45.4 million in 2020-21 to 792 new recipients, including free, digital and small-circulation periodicals, and provided an additional $23.3 million in 2021-22.

Online News Act
• The Government remains convinced of the need to move forward with the implementation of the Online News Act in order to create an environment conducive to the viability of the news media and audiovisual sector. This is necessary for the economic success of our media and cultural industries, but also for the health of our society and democracy.
• The purpose of the Online News Act is to strengthen equity in Canada's digital news market and contribute to its viability. The Act is an addition to existing and planned support for smaller players or businesses from underserved communities (e.g., Canada Periodical Fund, Local Journalism Initiative and Changing Narratives Fund).

Fiscal measures to support journalism
• Fiscal measures were first announced in Budget 2019:
1. the implementation of a 25 percent refundable tax credit on journalists’ salaries for eligible news organizations;
2. a temporary 15 percent non-refundable tax credit for Canadians on digital news platform subscription fees, scheduled to sunset in 2024; and
3. a change to the status of registered journalistic organizations to allow them to receive and issue official receipts for donations, tax-free.
• The Fall Economic Statement announced that, effective January 1, 2023, an increase to the yearly limit per eligible employee salary from $55,000 to $85,000 and temporarily increase the tax credit rate from 25 per cent to 35 per cent for a period of four years (until 2027 after which it reverts back to 25 percent);
• These changes would cost an estimated $129 million over five years, starting in 2024-25, with $10 million per year ongoing.
• Industry groups like News Media Canada and certain newspaper publishers have welcomed these changes that support investment in newsrooms.

Recent industry developments
• In February 2023, Québecor announced the elimination of 240 positions, including 140 at Le Groupe TVA. Le Groupe TVA, a subsidiary of Québecor, announced on November 2 the layoff of 547 employees, representing 31% of its workforce as part of a restructuring plan to focus more on its role as a broadcaster.
• Since 2008, 511 local news outlets closed including 393 community newspapers. In the same period 212 new local news outlets have launched, most of the new operations being online/digital outlets (Local News Research Project, Oct. 2023).

None