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By contrast, as I say, the idea that sales or value-added taxes should apply across the board, without exceptions, is standard economics: the sort of policy economists generally recommend and governments occasionally follow.

But. There are several buts, the largest of which is how such a policy would be enforced. We are not talking just of Netflix, after all, but potentially thousands of online providers, none of them with any presence on Canadian soil: no offices, stores, employees, or recoverable assets of any kind. If Canada has hesitated to require foreign-based services to collect the tax — and let’s be clear: this is about who collects the tax, not who pays it, which is you and me, friend — it may be because of the difficulty of applying Canadian law outside our borders.

Indeed, as Geist notes, even if the companies themselves were of a mind to comply, consumers might try to avoid the tax by giving a false address. Maybe the government could force offshore providers to supply it with the names and addresses of all of their subscribers; maybe it couldn’t. In any event, compliance costs would likely be high, relative to revenues — so much so, he argues, that some providers might decide to skip the Canadian market altogether.

The idea that sales or value-added taxes should apply across the board, without exceptions, is standard economics

It’s true that some countries — Australia, Japan, Switzerland — are beginning to apply their own sales taxes to foreign-based digital services, as Quebec has announced it will do, starting next year. It is also true that these will likely await broader international agreement on the “destination principle” (the idea that companies, no matter where based, should remit tax on the goods and services they supply in the countries where they are supplied) before they are effective.