Mr. Speaker, with regard to (a), talk shows are a source of jobs in the television industry. We firmly believe in the value of the creative sector. That is why we made a historic reinvestment in arts and culture in the budget, and why we continue to value programs like this as a source of jobs and economic growth.
The Canadian film or video production tax credit, CPTC, administered pursuant to section 125.4 of the Income Tax Act and section 1106 of the Income Tax Regulations, is a refundable corporate tax credit designed to encourage the creation of Canadian film and television programming and to develop an active domestic audiovisual production sector. It is co-administered by the Department of Canadian Heritage through the Canadian Audio-Visual Certification Office, CAVCO, and the Canada Revenue Agency.
To be eligible for the CPTC, a production must meet a number of requirements, including, but not limited to, minimum Canadian content points for key creative positions, e.g., director, screenwriter, picture editor; Canadian copyright ownership; Canadian producer control; a minimum percentage of certain prescribed costs being Canadian; and confirmation from a Canadian broadcaster or distributor that the production will be shown in Canada.
A production also cannot be an ineligible genre of production listed under the definition for “excluded production” in subsection 1106(1) of the regulations. This list of ineligible genres previously included “talk shows”. An amendment to the regulations published in the Canada Gazette, part II, on October 19, 2016, has removed “talk shows” from the list of ineligible genres.
The CPTC is available at a rate 25% of eligible labour expenditures incurred by a production company, which are capped at 60% of the production’s total costs, net of assistance.
With regard to (b), a tax credit is generally seen as foregone revenue, but the CPTC is also a driver of economic activity in the Canadian film and television industry, and thus contributes to the government’s aggregate tax revenues.
With regard to (c), the Department of Canadian Heritage conducted an analysis on the impact the amendment to the regulations would have on the value of the tax credit. The department has ongoing discussions with key players from the television production industry