Canadian Government Doubles Down on Abandoning Digital Rights In Budget

Canada’s recently proposed budget seems to be confirming again it’s lack of commitment to digital rights while doubling down on taxing web giants.

The Canadian government, headed up by Justin Trudeau’s Liberal Party, has increasingly been looking like the Paul Martin Liberal government. Back then, Liberals had pretty much declared war on the Internet at the behest of multinational corporations. No bad idea was off the table and every bad idea that was conceived was being actively pursued. In fact, if you go through the archives of my career spanning other sites, it’s notable just how cluttered it is with articles explaining the Canadian governments war on the Internet.

Fast forward 15 or 16 years later and today’s Liberal government seems to be virtually indistinguishable from the Martin Liberals of old. Does this idea assault the Internet? Does it crack down on digital rights? Will it regress Canada’s standing on the world stage on the digital front? If the answer is “yes” to any of those questions, it seems to fly. From warming up to Internet censorship to foot dragging on Canada’s privacy reforms, one thing is clear, the Canadian government has long dropped the facade of being the government that “finally got it” and moved an agenda that would make Canada actually compete on the world stage and mutated into a government that is virtually indistinguishable from past governments that so often screamed “I don’t get this interwebs thing!”

In fact, at this point, the only difference between this current government and past governments is that Trudeau at least has an understanding of what this whole Internet thing is all about. The problem is, he and his government has simply stopped caring and will continue attacking the Internet anyway. The issues might have varied in that Internet censorship is now becoming a top idea followed up by ill-advised link taxes to name a few. Then there is the looming Rogers Shaw deal that threatens to regress Canada even further – a development that has been seemingly universally opposed by Canadians.

These developments have been so exasperatingly bad, digital rights advocates are giving up trying to sugarcoat the governments efforts and declared the government “anti-Internet”. Indeed, so many have been trying to be supportive of the government over every overture and positive messaging going so far as to “read the signals”. Who could blame them? This is the first time a government actually gave a rats bass about what is in the interest of Canada and Canadians on the Internet side of things. For so many Canadian observers, including myself, we’ve known nothing different. So, the Trudeau’s so-called “sunny ways” was warmly welcomed – especially when it came to the tabling of Canada’s privacy reform bill. It felt like a move that was not only forward thinking, but also challenging cynics who figured no Canadian government would ever do something good on the digital rights file.

Now, we have the tabling of the 2021 budget. Since it’s been so long since Canada had a budget, it also theoretically served as a marker for where the government intends on taking the government. Now, to be sure, the government has been in power for a while now. If you can believe it, the election occurred back in 2019. The next election is scheduled to take place on or before October 16, 2023. Of course, the government is in a minority situation. Essentially, no party has the majority of the seats. So, the current government (the party with the most seats) needs the support of at least one other party to pass legislation. Sadly, the math means that this doesn’t apply to the Green Party who currently have too few seats to hold the balance of power. So, an election can easily occur before then.

In fact, budgets are generally “confidence votes”. Confidence votes mean that if parliament votes “no”, then this triggers an election. It is currently widely expected that the NDP will support the governments budget. So, it appears unlikely that an election will occur because of this. Still, despite this, most political analysts describe this budget as an “election budget”. In short, “vote for us and this amazing set of promises will be fulfilled. No, seriously, we totally pinky swear we’ll do what’s in this budget. Please stop laughing.” The idea is to give the governing party a launching pad to go into the next election with a nice sparkly sales pitch, leaving other parties to try and make up ground with their own vision of which direction the government should be headed.

With that context, note that with the next election scheduled to take place in two years, anything beyond that is going to happen well after the next election is easily something that can be taken as an election promise, not necessarily something that is actually set in stone and going to happen. Earlier this week, the government unveiled Budget 2021 which can be read on the official website. The question is, did various tech issues make it into it? As it turns out, the answer is “yes”, though it’ll easily leave some disappointed in it all.

One mention is found in Chapter 2 which contains the following:

4.7 Supporting a Digital Economy

More and more of our lives are happening online—from socializing, to our jobs, to commerce. Recognizing the fundamental shifts underway in our society, the government introduced a new Digital Charter in 2020 that seeks to better protect the privacy, security, and personal data of Canadians, building trust and confidence in the digital economy.

To make sure that Canadian businesses can keep pace with this digital transformation and that they are part of this growth, Budget 2021 includes measures to ensure businesses and workers in every region of the country have access to fast, reliable internet. It also has measures to make sure that the digital economy is fair and well reported on.

A digital economy that serves and protects Canadians and Canadian businesses is vital for long-term growth.

Accelerating Broadband for Everyone

The COVID-19 pandemic has shifted much of our lives online and transformed how we live, work, learn, and do business. This makes it more important than ever that Canadians, including Canadian small businesses in every corner of this country, have access to fast and reliable high-speed internet. Canadians and Canadian businesses in many rural and remote communities who still do not have access to high-speed internet face a barrier to equal participation in the economy. Building on the $6.2 billion the federal government and federal agencies have made available for universal broadband since 2015:

  • Budget 2021 proposes to provide an additional $1 billion over six years, starting in 2021-22, to the Universal Broadband Fund to support a more rapid rollout of broadband projects in collaboration with provinces and territories and other partners. This would mean thousands more Canadians and small businesses will have faster, more reliable internet connections.

In total, including proposed Budget 2021 funding, $2.75 billion will be made available through the Universal Broadband Fund to support Canadians in rural and remote communities. Recently, the Universal Broadband Fund provided funding to ensure Quebec could launch Operation High Speed, connecting nearly 150,000 Quebecers to high-speed internet. These continuing investments will help Canada accelerate work to reach its goal of 98 per cent of the country having high-speed broadband by 2026 and 100 per cent by 2030.

During the last election, this is something that was pushed by a number of parties with no one really opposing the idea. So, you’d think that there is plenty of time between 2019 and now to, at least, formulate something concrete. Instead, we see a promise that, if an election happened because of the budget, then maybe the Canadian government might be able to throw some cash at this issue by the end of the next mandate. Let’s face it, people in these communities don’t need to wait another six whole years before they might get some reliable Internet access. If this government promised that they will have COVID-19 vaccines 6 years from now, how much whaling and gnashing of teeth would be directed at the Canadian government? If things go well, the pandemic will be long over before people in some of these communities would even start seeing the benefits of this.

Things continue to roll downhill from there as that section was followed up by this:

Establishing a New Data Commissioner

Digital and data-driven technologies open up new markets for products and services that allow innovative Canadians to create new business opportunities—and high-value jobs. But as the digital and data economy grows, Canadians must be able to trust that their data are protected and being used responsibly.

  • Budget 2021 proposes to provide $17.6 million over five years, starting in 2021-22, and $3.4 million per year ongoing, to create a Data Commissioner. The Data Commissioner would inform government and business approaches to data-driven issues to help protect people’s personal data and to encourage innovation in the digital marketplace.
  • Budget 2021 also proposes to provide $8.4 million over five years, starting in 2021-22, and $2.3 million ongoing, to the Standards Council of Canada to continue its work to advance industry-wide data governance standards.

If you are into the privacy debate in Canada as much as we are, you’ll very likely look at this and go, “wait… what?” In all the discussion surrounding privacy issues, I can’t honestly recall anyone saying, “we really need more study on this issue. Also, maybe a new commissioner is needed at this point.” What is needed is for Privacy Commissioners to be able to slap fines on companies who break the law. It is plainly obvious that strongly worded letters just aren’t enough. The commissioners themselves effectively admitted to this back in 2019 when they had to sue Facebook as private citizens. With another security incident happening at Facebook, Canadian’s are realizing that their government has no power to hold companies like Facebook accountable. You’d think this problem being repeated would be motivation for the government to finally do something about this.

What we see above is that the Canadian government is, once again, signalling that Canada’s personal privacy is just not that important. With Canadian’s seeing their personal information either being misused or getting lost or stolen, its stunning to see a government basically come out and say that they’ll spend the next 5 years… uh… studying the issue. The only people who are thrilled by this are companies that knowingly abuse the personal information of Canadian’s. They know that they are free to buy and sell the data, maybe even improperly obtaining this data in the first place, and the worst that will happen is that someone might send them a strongly worded letter. The message the above sends is that if a company loses your personal information in the next few years, you are on your own because the Canadian government doesn’t think this matters enough to warrant serious attention.

So, a question might be, what is actually a priority for the Canadian government? Well, for those who are familiar about the “get money from web giants” line of thinking, part 4 has a section that is all too familiar:

Digital Services Tax

The government is committed to ensuring that corporations in all sectors, including digital corporations, pay their fair share of tax on the money they earn by doing business in Canada. Increasingly, many digital companies earn revenues from the active collection and use of Canadians’ data. In the 2020 Fall Economic Statement, the government announced that it would be moving ahead to implement a tax on corporations providing digital services. This builds on the changes announced at that time to ensure that the Goods and Services Tax/Harmonized Sales Tax applies in a fair and effective manner to the growing digital economy.

Canada has a strong preference for a multilateral approach to this issue. Work is underway to reach a multilateral agreement on cross-border digital taxation by mid-2021, and Canada is optimistic about the progress made this year. However, multilateral discussions have been going on since 2013. That is why, while Canada’s hope and preference is for a multilateral solution this summer, whether or not a deal is reached, Canada intends to take action.

  • Budget 2021 proposes to implement a Digital Services Tax at a rate of 3 percent on revenue from digital services that rely on data and content contributions from Canadian users. The tax would apply to large businesses with gross revenue of 750 million euros or more. It would apply as of January 1, 2022, until an acceptable multilateral approach comes into effect. This would help ensure that Canada’s tax rules capture new ways in which businesses carry out value-creating activities.

It is estimated that this measure will raise $3.4 billion in revenue over five years beginning in 2021-22.

Note the completely different projected timeline. This proposal isn’t happening 5 or 6 years down the road – it’s happening immediately. On top of it all, the only thing talking about what’s going to happen in the next 5 years is how much revenue this new tax is supposed to bring in. Want to have your personal information protected? That’s not really Trudeau’s thing right now. Hoping to see opportunities afforded to rural and indigenous communities with expansion of broadband access? That can wait. Slapping a tax on large tech giants? Top priority, it’s happening today.

Ultimately, this budget shows another glaring example of just how far the government has fallen. It signals that the Canadian government not only has been labelled as being the anti-tech government of today, but also doesn’t really care either. Sadly, it’ll leave Canadians to continue to pay the price in all of this.

Drew Wilson on Twitter: @icecube85 and Facebook.

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