Prime Time Protectionism Harms American Consumers

Millions of Americans are about to pay more for their streaming subscriptions, and foreign governments are to blame. Under Canada’s Bill C-11, the “Online Streaming Act,” streaming companies that earn at least $25 million in Canadian gross revenue (read: American streaming platforms) must fork over five percent of Canadian revenues to support Canadian programs.

And now, Canada is tripling this tax-by-any-other-name on American streaming services and their vast customer base. A new ruling by the Canadian Radio-television and Telecommunications Commission increases the base contribution from five percent to 15 percent, ensuring that Netflix, Disney+, Amazon Prime, and YouTube subscribers pay for content nobody (except bureaucrats) asked for. Canada and other foreign governments should hit pause on these unfair practices and greenlight fair streaming policies.

Canada is just the latest in a long line of governments raising costs and buffering innovation. In its recent report “Death by a Thousand Quotas: The Impact of Foreign Regulations on Streaming Services,” the Taxpayers Protection Alliance highlights these attempts to punish successful American streaming services and their subscribers.

Platforms are facing an increasingly daunting maze of foreign regulations, including content quotas, special taxes, discoverability mandates, and compulsory spending requirements. TPA’s report finds that these measures operate as a form of digital protectionism that increases costs, reduces consumer choice, and discourages innovation in the streaming marketplace.

A key conclusion of the report is that many governments are attempting to require streaming services to financially support domestic entertainment industries regardless of actual consumer demand. For example, in the European Union streaming providers must ensure that at least 30 percent of their catalogs consist of European works. Many EU member states have gone even further by requiring platforms to dedicate a share of their local revenues to domestic film and television production. These policies make a mockery of normal market incentives by elevating political objectives above consumer preferences and compelling investment decisions based on geography rather than audience interest.

The report identifies Canada and Québec as among the most aggressive adopters of these policies. Québec’s Bill 109 includes “discoverability” requirements that pressure streaming services to promote government-favored local content. Such rules effectively interfere with recommendation systems by encouraging regulators to influence what viewers see and consume. Rather than allowing users to find content based on their interests and viewing habits, policymakers are attempting to shape cultural outcomes through mandated promotion schemes. The report cautions that these requirements could undermine personalization, diminish the user experience, and increase compliance burdens for companies operating across multiple markets.

Australia is pursuing a similar approach. Under legislation enacted by the Australian Parliament, major streaming services must either devote at least 10 percent of their local programming expenditures or 7.5 percent of their Australian revenues to domestic content. These obligations function as a de facto tax on streaming providers that will ultimately be reflected in higher costs for consumers. Because streaming markets are already highly competitive and sensitive to pricing, additional regulatory mandates are likely to discourage investment, raise barriers to entry, and limit consumer options.

Although U.S. streaming companies and their customers bear much of the immediate burden, local creators may also suffer unintended consequences. Supporters of quotas frequently claim that such policies protect domestic culture, but mandated content requirements can reward compliance with regulatory definitions rather than genuine audience appeal. Streaming services may respond by producing lower-cost programming designed to satisfy quota obligations instead of investing in content with broader market potential. Over time, this risks making creative industries more dependent on government mandates and less responsive to consumer demand.

Congress and the Trump administration must challenge these efforts to impose discriminatory burdens on successful American streaming platforms. Consumers in the U.S. should not be forced to shoulder the costs of foreign governments’ streaming taxes and regulatory schemes.

Ross Marchand is the executive director of the Taxpayers Protection Alliance.