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Arrest of Telegram founder Pavel Durov signals an increasing threat to digital freedom

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27 minute read

Pavel Durov of Telegram speaks during the Digital Life Design conference (DLD) at HVB Forum on January 24, 2012, in Munich, Germany

From LifeSiteNews

By Christina Maas

The message being sent to every tech visionary, journalist, or outspoken citizen is if you don’t play by the new rules, the state will come for you. They’ve got the global mandate to ensure that dissenting voices are silenced, one way or another.

Picture this: a tech billionaire, who’s made his fortune building a platform that prioritizes privacy and free speech, is arrested at a Paris airport. Sounds like the plot of a dystopian thriller, right? Except it’s real life. Pavel Durov, the brain behind Telegram, found himself in handcuffs at Le Bourget airport over the weekend, marking another dark chapter in the ongoing war against free speech. 

What’s Durov’s crime, you ask? Well, it depends on which bureaucrat you ask. According to the official indictment, he’s guilty of everything short of kicking puppies – fraud, drug trafficking, organized crime, encouraging terrorism, and, just for good measure, providing encryption. The French authorities must have felt ambitious that day, throwing in the entire criminal code just to be sure. Let’s not forget that this whole circus started because Durov reportedly had the audacity to support free speech. Apparently, in 2024, that’s enough to get you a one-way ticket to a Parisian jail cell. 

READ: Telegram founder Pavel Durov arrested in France 

Durov’s detention has been extended by 96 hours. Because, you know, it takes a while to figure out which of these ludicrous charges will stick when the real crime was defending free speech. 

French President Emmanuel Macron assures everyone that Durov’s arrest is nothing more than a purely “judicial,” non-political act. You know, the kind of legal housekeeping every free society must endure to keep its otherwise robust freedoms from accidentally going rogue. Because, clearly, when you find the head of a privacy-focused tech giant behind bars, it’s all about upholding legal standards, right? 

But before we crown France this month’s champion of authoritarianism, let’s take a quick tour around the globe. In the European Union’s ever-benevolent grasp, a high-ranking official is threatening to drag U.S. social media platforms  through the censorship ringer. What’s the endgame? To ensure that the EU’s favorite brand of speech policing crosses the Atlantic. Forget about free expression – it’s all about toeing the line, or else. 

Not to be outdone, Brazil’s Supreme Court is adding its own flair to the global crackdown with secretive censorship orders slapped on online platforms. The idea here is simple: if you can’t kill the message, just gag the messenger. No court hearings, no appeals – just pure, unfiltered control. 

So, here we are, watching as the pillars of free speech are bulldozed in broad daylight, with tech moguls like Durov tossed behind bars for daring to build platforms that don’t kowtow to government censorship. The arrest of a billionaire for refusing to censor, a prime minister having citizens arrested for social media posts, an EU official threatening American companies with censorship demands, and a Brazilian judge unleashing secretive orders – this isn’t just a bad month for free speech; it’s a full-on assault. 

What’s the message being sent to every tech visionary, journalist, or outspoken citizen? Simple: if you don’t play by the new rules, the state will come for you. They’ve got the handcuffs, the secret orders, and, apparently, the global mandate to ensure that dissenting voices are silenced, one way or another. 

This isn’t just about Durov or Telegram. This is about the battle lines being drawn between governments that want absolute control and a shrinking pool of platforms still willing to fight for freedom. These are dangerous times for free speech, and if we don’t pay attention, we might just wake up to find it gone for good. 

Durov, who departed Russia in 2014 following disagreements with the Kremlin over internet freedoms, particularly related to his refusal to close opposition groups on the VK social network which he founded at the age of 22, has since dedicated his efforts to developing Telegram. 

Yet, after escaping Russia and its oppressive censorship demands, it’s now Western governments that have been the ones to make censorship demands. 

Created with his brother Nikolai in 2013, Telegram initially functioned similarly to other messaging services but has evolved into a more complex social network, facilitating large-scale communication through channels and groups. 

Despite residing in Dubai, where he enjoys citizenship alongside France and the UAE, Durov champions the app as a bastion of neutrality and free speech in an increasingly monitored digital world. 

In a statement on Telegram, the company said, “Telegram abides by EU laws,” mentioning the Digital Services Act in particular and adding that Pavel Durov “has nothing to hide.” 

The sight of Russian officials donning the mantle of “free speech defenders” is like watching a fox petition for chicken rights. Yet, here we are. Moscow is outraged – not at the idea of censorship (they do enough of that themselves) but because they’re not the ones holding the keys to the cell. French authorities, evidently too busy trying to build a legal house of cards against Telegram’s founder have somehow managed to snub their Russian counterparts, who are now demanding consular access and throwing diplomatic shade from the Russian embassy in Paris. 

Enter Vladislav Davankov, the deputy speaker of Russia’s State Duma, who’s managed to turn Durov’s arrest into a soapbox moment. Davankov’s allegation? That Durov’s detention is nothing more than a thinly veiled scheme by the West to hack into Telegram’s treasure trove of user data. According to him, this kind of violation of privacy “cannot be allowed.” That’s rich, coming from a regime that’s never met a dissident it didn’t want to silence or a data packet it didn’t want to intercept. But his allegations against the French government may actually be pretty close. 

To understand why Moscow is crying foul over Durov’s arrest, one must rewind the clock to 2014, when a 29-year-old Durov found himself at odds with the Kremlin. Back then, the Russian government was trying to twist his arm to shut down opposition groups on VK, the social network Durov had built from the ground up. Instead of capitulating, Durov took a stand for internet freedom, packed his bags, and left Russia for good. Fast forward a decade, and Durov is now based in Dubai, where he enjoys triple citizenship and a lifestyle reportedly far removed from his Kremlin-tangled past. 

Durov’s masterpiece, Telegram, started as just another messaging app, but has since morphed into a digital juggernaut. With 950 million monthly users, it’s a lifeline for news, a platform for both truth (and yes, like any other platform or legacy news outlet, misinformation) and, much to the chagrin of various governments, a symbol of digital resistance. In the chaotic storm of Russia’s invasion of Ukraine, Telegram has become a critical tool for both reporting on the conflict and narratives that governments find increasingly difficult to control. 

The irony in all of this is that after fleeing Russia’s oppressive demands, it’s now the so-called free world coming after Durov. The man who said “no” to the Kremlin’s censorship now finds himself in the crosshairs of Western governments, who are just as eager to force his hand. While the West has long championed itself as a bastion of free speech, Durov’s recent experience suggests otherwise. 

Telegram’s official statement makes this clear enough: “Telegram abides by EU laws,” it reads, with a polite nod to the much-vaunted Digital Services Act. But the real interesting part comes with the company’s assertion that Durov “has nothing to hide.” This could be true – or it could be the last defiant proclamation before the doors are kicked in by the data-hungry enforcers of digital orthodoxy. 

For Durov, this ordeal must feel like a twisted rerun. The same man who once resisted Moscow’s censorship demands now finds himself dodging the West’s increasingly sharp regulatory spears. It’s a grim reminder that no matter which flag flies over the government building, those in power seem to share one common goal: control. 

The arrest, coupled with the Kremlin’s performative outrage, lays bare the truth about the state of global free speech: it’s under attack from all sides. Whether it’s through overt censorship, as seen in Russia, or the subtler, but equally insidious, pressures from the West, the aim is the same: silence dissent, control the narrative, and pry open every digital lock that doesn’t fit the state’s key. 

In the EU, the Digital Services Act has been rolled out with all the fanfare of a revolutionary triumph, marketed as a safeguard for user “safety.” The truth, however, is far more sinister. What the EU is really doing is tightening its grip on the digital world, muzzling dissent under the guise of combating “misinformation” and “hate speech.” The arrest of Durov in France is just the latest – and most brazen – example of this creeping authoritarianism dressed up in bureaucratic language. 

The DSA is the EU’s shiny new tool for keeping social media and tech companies under its thumb. It mandates that platforms like Telegram must now answer to Big Brother, swiftly addressing so-called “disinformation” or risk facing severe penalties. The law is designed to force companies to do the dirty work of governments, effectively turning them into enforcers of state-approved narratives. It’s not about protecting users; it’s about controlling them. And in the world of modern governance, where the line between regulation and repression is blurrier than ever, Durov’s arrest is a warning shot. 

Digital speech under siege: Europe’s march toward censorship 

Let’s not mince words: the EU’s relentless push to “enhance user safety” is a euphemism for ramping up censorship. By couching these regulations in the language of public good, the EU manages to dodge the inconvenient truth that its real goal is to control the flow of information. The Digital Services Act, hailed as a “significant overhaul” of the EU’s digital policy, is little more than a power grab disguised as a public service. And the timing of Durov’s arrest in France – an EU stronghold – couldn’t be more telling. 

Durov, who’s spent years fighting back against censorship, now finds himself in the middle of a battle over the future of online speech. He’s built his reputation on refusing to bow to government demands, whether from the Kremlin or the West. But with his arrest in a supposedly free country, we see just how far the EU is willing to go to enforce its new digital regime. 

The DSA gives the EU unprecedented control over tech companies, demanding rapid responses to whatever it deems unfit for public consumption. For Telegram, this means beefing up content moderation or facing the wrath of Brussels – a stark choice between betraying its principles or suffering the consequences. 

READ: Christian doctor in Germany receives 2,500-euro fine for warning about COVID jab dangers in 2021 

The global chill: Durov’s arrest as a warning to tech CEOs 

Durov’s arrest sends a clear and chilling message: no one is safe from the reach of the state. If a billionaire tech CEO can be nabbed at an airport and held on dubious charges for daring to defend free speech, what hope is there for anyone else? The EU’s new laws and the arrest of Durov mark a dangerous escalation in the global war on free expression. Other tech leaders who have championed privacy and resisted censorship must be watching with a mix of fear and trepidation, wondering if they’re next on the hit list. 

The implications are profound. Durov’s stand against censorship has made him a symbol of resistance, but it’s also turned him into a target. The arrest coincides with an era where tensions over digital freedom are reaching a boiling point. Governments across the globe are tightening their noose on online platforms, and the EU’s DSA is the latest weapon in this fight. What we’re witnessing is the opening salvo in a broader campaign to control the digital public square, to ensure that only the “correct” information sees the light of day. 

The digital guillotine: How the EU’s DSA is reshaping the internet 

In the tradition of authoritarian overreach, the EU’s DSA represents more than just regulation – it’s the construction of a digital guillotine. The law doesn’t just keep tech companies in check; it keeps them in fear. With the power to fine, sanction, or even shut down platforms that don’t toe the line, the DSA is a blueprint for modern-day censorship, one that’s already beginning to claim its first high-profile victim in Durov. 

Tech bosses are increasingly finding themselves in the crosshairs of powerful states eager to bend digital platforms to their will. Just ask X owner Elon Musk, who has escaped the wrath of both Brazil and the European Union this month. 

Musk’s crime was refusing to play ball with their censorship demands. Brazil, never one to shy away from the strong-arm approach, even threatened to lock up X employees if they didn’t secretly censor users. Musk and X CEO Linda Yaccarino’s response was to shut down operations in Brazil entirely – an audacious move, but one that highlights the growing tension between tech innovators and authoritarian government actions. 

But the Durov saga takes this conflict to a new, terrifying level. While it’s not Brazil’s first rodeo – remember when they threw Facebook’s Diego Dzodan behind bars in 2016 for WhatsApp’s encryption? – Durov’s arrest marks a grim first: the CEO of a major messaging platform being jailed for refusing to censor. The message to tech leaders is crystal clear: stand up to government overreach, and you might just find yourself in a cell. 

A screenshot of a Washington Post 2016 article titled, "Senior Facebook executive arrested in Brazil after police are denied access to data."The Washington Post – 2016

A chilling effect on innovation 

Durov’s arrest is a dire warning to anyone who dares to innovate in the realm of communication. 

The chilling effect this could have on innovation cannot be overstated. Imagine the next generation of tech entrepreneurs, who might now think twice before developing a revolutionary new app or encryption tool, fearing they’ll end up like Durov. 

This crackdown could particularly cripple the burgeoning crypto industry, where privacy and decentralization are core tenets. If tech CEOs are too scared to push the boundaries of free communication, the progress in these fields could grind to a halt. The digital market would be poorer for it, as the space for free expression shrinks and the room for government surveillance expands. 

Elon Musk, never one to shy away from controversy, wasted no time showing solidarity with Durov. His “#FreePavel” post accompanied a video clip of Durov praising X for fostering innovation and freedom of expression. 

Musk’s tweet was a clear shot across the bow, aimed at governments who think they can bully tech leaders into submission. But he didn’t stop there. In a further swipe at the powers that be, Musk called out the hypocrisy surrounding Durov’s arrest by questioning why other tech leaders – looking at you, Mark Zuckerberg – haven’t faced similar legal heat. 

Musk’s point is as sharp as it is damning. Zuckerberg, the poster child for compliance, has avoided the kind of scrutiny that’s now falling on Durov. 

Musk pointed out the glaring double standard: while Durov is arrested for standing up to censorship, Zuckerberg seems to skate by, despite Instagram being plagued by a “massive child exploitation problem.” According to Musk, the difference is simple – Zuckerberg “already caved into censorship pressure” and “backdoors” making him a darling of the same governments now going after Durov. In Musk’s eyes, it’s not about justice or protecting users; it’s about punishing those who refuse to kneel. 

The future of free speech: A digital Cold War 

Durov’s arrest, coupled with Musk’s pointed critique, highlights a deepening divide in the tech world. On one side, we have leaders like Durov and Musk, who are willing to fight for digital freedom, even if it means taking on the most powerful governments in the world. On the other hand, there are those who’ve chosen to play it safe, complying with censorship demands to avoid the kind of fate that’s now befallen Durov. 

But the stakes in this digital Cold War are high. If governments succeed in making examples out of leaders like Durov, the era of free and open digital communication could be nearing its end. Innovators might retreat from building the next Telegram or X, knowing that doing so could land them in jail. 

If you needed another sign that the battle for free speech is turning into a full-blown exodus, look no further than Rumble CEO Chris Pavlovski, who has just packed his bags and left Europe after a visit. 

Pavlovski, a vocal critic of government censorship, could be staring down the barrel of the same threats that led to Durov’s detention. But unlike most tech CEOs who prefer quiet compliance to public defiance, Pavlovski is making it clear: he’s not going down without a fight. 

Rumble, a platform built on the promise of free expression, has been under fire from France for some time. The French government has been relentless in its push to censor content on the platform, leading to ongoing litigation. But Durov’s arrest has pushed Pavlovski to escalate his stance. On X, he blasted France for crossing a red line, calling Durov’s arrest a blatant violation of fundamental human rights. “Rumble will not stand for this behavior,” he declared, vowing to use every legal weapon in his arsenal to defend free speech. His message is clear: the fight for digital freedom is global, and it’s far from over. 

Pavlovski’s critique of the French government’s actions goes beyond mere rhetoric. By linking Durov’s arrest to a broader crackdown on free expression, he’s framing this as a global issue – one that tech companies can no longer afford to ignore. The implications of Durov’s arrest are chilling. It’s not just about one CEO being dragged off a plane; it’s about the growing power of governments to intrude into private communications on platforms that were once considered safe havens for free speech. 

READ: Expert: US intelligence agencies using psyops to thwart Trump, undermine democracy 

Pavlovski’s words resonate with a fundamental truth: the war on digital freedom is escalating, and it’s playing out in courtrooms and boardrooms across the world. 

The question now is how many other tech leaders will join in taking a stand. Will they rally behind Durov, Musk, Pavlovski, or will they buckle under the pressure, opting for the safety of compliance over the risk of resistance? One thing is certain: as the war on free speech heats up, the choices made by today’s tech CEOs will determine the landscape for years to come. And for those who believe in the sanctity of free expression, there’s no room left for complacency in this fight. 

Reprinted with permission from Reclaim The Net

Business

The Digital Services Tax Q&A: “It was going to be complicated and messy”

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A tax expert on the departed Digital Services Tax, and the fiscal and policy holes it leaves behind

It’s fun, and fair, arguing whether Mark Carney “caved” in suspending the application of Canada’s Digital Services Tax to revive broader negotiations with the Trump administration. But I figure there are other dimensions to this issue besides tactics. So I got in touch with Allison Christians, a tax law professor at McGill University and the founding director of the Canadian Centre for Tax Policy.

In our talk, Christians discusses the policy landscape that led to the introduction of the DST; the pressure that contributed to its demise; and the ways other countries are addressing a central contradiction of the modern policy landscape: without some kind of digital tax, countries risk having to impose costs on their own digital industry that the overwhelmingly US-based multinationals can avoid.

I spoke to Christians on Friday. Her remarks are edited for length and clarity.


 

Paul Wells: I noticed in your social media that you express inordinate fondness for tax law.

Allison Christians: You will not find a more passionate adherent to the tax cult than me. Yes, I do. I love tax law. Of course I do. How could you not? How could you not love tax law?

PW: What’s to love about tax law?

Christians: Well, tax law is how we create our country. That’s how we build our society. That’s how we create the communities that we want to live in and the lifestyle that we want to share with our neighbours. That’s how: with tax law.

PW: I guess the goal [of tax policy] is to generate the largest amount of revenue with the smallest amount of grief? And to send social signals while you’re at it. Is that right?

Christians: I don’t think so. Tax is not about raising maximum revenue. Tax is about deciding what society you’re trying to build and what portions of that society need to be made public, and what can be left to private interests which then need to profit. So we have decided in Canada, as a country, that basic minimum healthcare cannot be a for-profit enterprise. It has to be a public enterprise in order to make sure that it works for everybody to a certain basic level. So tax is about making those decisions: are we going to privatize everything and everyone pays for their own health care, security, roads, insurance, fire department etc. And if they can’t pay, then too bad? Or are we going to have a certain minimum, and that minimum is going to be provided in a public way that harmonizes across the communities that we have. And that’s what tax is about. It’s not about extracting revenue at all. It’s about creating revenue. It’s about creating a market. It’s about investing in a community. So I just object to the whole idea that tax is about extracting something from me, because what tax is doing is creating a market for me to be able to thrive. Not just me, but all of my neighbours, as well.

PW: Let’s jump forward to the events of the past couple weeks. Were you surprised when the Prime Minister suspended the Digital Services Tax?

Christians: I think “surprise” is probably too strong of a word, because nothing any political leader does to cope with the volatility of the United States would surprise me. We are dealing with a major threat, a threat that is threatening to annex us, to take our resources, to take our sovereignty, to take our communities and rip them apart and turn them into a different way of being. And that’s a serious threat. So nothing would surprise me in response to that. Disappointed, of course. But not disappointed in our Canadian response. More disappointed in the juggernaut that Trump has been allowed to become by his base, and that they’re pulling the rug out from under everyone that’s cooperated with the US agenda for decades, including us.

PW: What’s your best understanding of what the Digital Services Tax was designed to accomplish? And is it unusual as taxes go?

Christians: So to understand this, you really have to be a policy wonk, which isn’t much fun. So I’m gonna give you an example that might make it clear from the perspective of Canada. Why we might have a Digital Service Tax or might want something like it.

I want to preface this by saying that the Digital Service Tax is by no means the only way to do the underlying things we want to accomplish. Certainly other countries have been collecting DSTs and have been collecting billions of dollars, and US companies have had reserves for paying that Digital Service Tax. So we just left money on the table. But let me try to explain why we want to do the thing without getting too “tax nerdy” on you.

So I’m sure you can come up with the one Canadian company that’s streaming content on television or on digital devices.

PWCrave?

Christians: Yeah, that’s the one. Crave is owned by Bell Media and is a Canadian company. And Crave pays taxes in Canada. Crave has to compete against Netflix, which does not have to pay tax in Canada. Netflix just simply doesn’t have to pay the same way that Crave does unless we force them to pay. Crave has to compete with US and foreign content streamers. We may get to a point where we can get Netflix to collect some sales tax on the GST, for example. But if Netflix itself stays out of Canada, physically, but it’s still getting all those customers that otherwise Crave would have access to, then Crave is at a structural disadvantage.

Now tell me which Canadian provider competes with Google.

PW: I can’t think of one.

Christians: Exactly. There isn’t one. How are we supposed to get a homegrown competitor when our competition simply does not pay taxes, and any one we would grow here in Canada has to pay tax here? So we have to understand the Digital Service Tax as simply our response to the fact that we normally do not tax a company unless they are physically located in Canada. But now we’ve got to go into this digital space and say: you’re still here, even if we can’t see you and talk to you, you’re still here. You’re doing something in our market. And that’s what the Digital Service Tax was trying to deal with.

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PW: Now, how are companies likely to respond to this Digital Services Tax? It seems to me the likeliest outcome would be that they would pass those costs on to their customers.

Christians: Yes, that is what companies have said they would do. Google talked about passing those costs on to the customers. And their customers obviously are advertisers. I want to point out that advertisers in Canada used to advertise in local newspapers and media. Now they advertise on Facebook, owned by an American-headquartered Company, Meta. Right now, they advertise on those foreign platforms, so we don’t have those advertising dollars here. Advertisers might have had to pay the Digital Service Tax if Google, or whoever, had passed it on to them. I think it’s fair to say, that Canadians advertising on those foreign platforms would have faced a gross-up to cover that tax.

PW: So, the net effect is that it just becomes more expensive for Canadian consumers. I’ve seen it argued that all this tax would have succeeded in doing is making Netflix more expensive.

Christians: Okay, that’s possible. I mean, that assumes the supply is totally elastic: you can increase the price of Netflix, and people will still pay it indefinitely. Right? So that’s the assumption in the short term. But the long-term assumption is that Crave becomes more competitive — because its competitors are paying the same tax that it is paying. The Crave subscription price may or may not respond, but if you put pressure on the foreign service providers in the same manner that’s on the Canadian providers, it might cost more, but we’re also getting the tax.

PW: I believe the Prime Minister, in an interview with the CBC said that he was thinking of getting rid of this thing, anyway. [The quote I’m reaching for here is: “Look, what we did this week is something that I think we were going to do anyways, in the end, for the deal.” At 1:07 in this video. — pw] Why do you think he would have been leaning in that direction? And do you think that absent a Truth Social post by President Trump, he actually would have gotten rid of the thing?

Christians: I can’t speculate too much about the politics of this, because I’m not talking to many of the people that make policy, but I know the complaints about the DST, and I don’t dispute them. It was going to be a complicated tax to collect and it was going to be messy in terms of compliance. There’s a lot of uncertainty around the tax and I know there’s always an enormous amount of pressure to reduce all taxes. There’s always going to be that segment of society that sees taxes being thrown down the drain and not as an investment in the society that we want to live in.

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American companies are famous for investing their money on lobbying and not in taxes. They spend their money convincing us that it would be bad for us to tax them, and they can spend a much smaller percentage of their money on lobbying and get us to believe that narrative. And the narrative is that somehow, if we tax Google, Google will go away and we won’t be able to use it. That Google won’t innovate. It’s nonsense, but it’s a story that resonates nonetheless. Was Prime Minister Carney pressured to get rid of the DST? Undoubtedly. And maybe he personally thinks there’s a better way to tax these companies than with an excise tax. I don’t fault him for thinking that. I have even written that there are better ways for Canada to collect this tax than the Digital Services Tax.

PW: I’m going to want you to tell me about these other ways. But I assume that if a Canadian government attempts any of these other ways, then the companies we’re talking about know that all they have to do is hit the Trump button and the pressure will be right back on.

Christians: That’s correct. There are a couple of [alternatives to the DST]. We could, like some other countries have done, redefine the types of income that we subject to withholding taxes in Canada. It’s a complicated technical idea, but basically any payments that go from our advertisers to Google, we could impose a withholding tax simply by expanding a couple of definitions in the Income Tax Act that would then carry over into our treaty. Now, people will push back on that, and say that you’re changing a deal, and people will object to that. And we can have an argument about that, but that possibility exists. That withholding tax is the most straightforward way to do this and we should probably already be thinking about it.

Another one that’s kind of fun, which I really enjoyed learning about when I came to Canada, is Section 19 in the Income Tax Act. So, Canadian advertisers are paying Google now, instead of a Canadian newspaper. Well, Section 19 basically says that whenever someone makes a payment for advertising to a foreign, non-Canadian media, that payment’s not deductible.

Now that provision seems to violate Free Trade rules because it changes, depending on who you make the payment to. But it’s a provision in law. The US objected to it when we adopted it by imposing a reciprocal tax on US advertisers paying Canadian outlets, which doesn’t seem to bother anybody.

PW: But the application of that will be very asymmetrical, right?

Christians: Yes, for sure. And I’ll tell you what the Canadian media noticed when we started paying for digital newspapers online: that they’re not subject to Section 19 — only print and traditional media are subject to this denial of deduction — and Canadian media advocated for this denial of deduction for online publications as well.

All you have to do is look at the wording of Section 19 — and you don’t even have to change the words — and all of a sudden all those payments to Google are not deductible. But if the payments were to Crave, they would be deductible, and if they are to the Globe and Mail, or other Canadian companies, they would be deductible. That is a different kind of advantage for the Canadian competitor that’s a little less susceptible to Trump’s understanding, and a little less susceptible to the politics that surround the Digital Services Tax. But it’s technical. You have to explain it to people, and they don’t believe you. It’s hard to understand it.

PW: Theoretically a two-time central-bank governor could wrap his head around it.

Christians: Yes, I think he could fully understand it, for sure. You’re absolutely right. Will he want to do it, though? I just don’t know.

PW: You said that there are other jurisdictions that continue, today, to successfully tax the web giants. Who are you thinking of?

Christians: Well, Austria’s been doing the Digital Service Tax since the beginning. The UK has the Diverted Profits Tax that they’ve been using. Australia has one that’s been enforced. Austria stands out because I think it was 2017, in Trump’s 1st term, and it was part of a group that Trump threatened to retaliate against, but they just quietly kept going and they’re still collecting it. Part of the narrative is that we, Canada, came too late to the DST party. We just weren’t part of that initial negotiation. We came in too late, and then it was too obvious, and people were able to isolate us from the pack.

PW: My understanding is we’re looking at a hypothetical $7.2 billion in revenue over 5 years. And that represents a shortfall that’s going to have to be found either in other revenue sources or in spending cuts, or in greater debt. Aside from the DST, do you think Canada could use a general overhaul of its tax code?

Christians: Always. Yes, absolutely! Taxes are funny, right? Because they come into every single political battle, and what ends up happening is that politicians treat the Tax Act and the tax system as a present-giving machinery, and not as a clear policy deliverance system.

I am, every day, surprised at how complicated the Canadian tax system is. It’s way too complicated. You can’t even fill out your own tax return in this country. You’re going to make mistakes because it’s just too ridiculously written. It’s too confusing. It’s too messy. So it’s time to take another look. But you need a commission [like the 1962 Carter royal commission on taxation]. You need to be bipartisan. You need to spend money on that. You need to think that the things that you do have long-term effects, and this takes political courage. And basically it requires upsetting a bunch of people and resetting things, and we just might not be at the right time politically to be doing that because people feel vulnerable to volatility from abroad. So it may not be the time to push that.

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Dallas mayor invites NYers to first ‘sanctuary city from socialism’

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From The Center Square

By

After the self-described socialist Zohran Mamdani won the Democratic primary for mayor in New York, Dallas Mayor Eric Johnson invited New Yorkers and others to move to Dallas.

Mamdani has vowed to implement a wide range of tax increases on corporations and property and to “shift the tax burden” to “richer and whiter neighborhoods.”

New York businesses and individuals have already been relocating to states like Texas, which has no corporate or personal income taxes.

Johnson, a Black mayor and former Democrat, switched parties to become a Republican in 2023 after opposing a city council tax hike, The Center Square reported.

“Dear Concerned New York City Resident or Business Owner: Don’t panic,” Johnson said. “Just move to Dallas, where we strongly support our police, value our partners in the business community, embrace free markets, shun excessive regulation, and protect the American Dream!”

Fortune 500 companies and others in recent years continue to relocate their headquarters to Dallas; it’s also home to the new Texas Stock Exchange (TXSE). The TXSE will provide an alternative to the New York Stock Exchange and Nasdaq and there are already more finance professionals in Texas than in New York, TXSE Group Inc. founder and CEO James Lee argues.

From 2020-2023, the Dallas-Fort Worth-Arlington MSA reported the greatest percentage of growth in the country of 34%, The Center Square reported.

Johnson on Thursday continued his invitation to New Yorkers and others living in “socialist” sanctuary cities, saying on social media, “If your city is (or is about to be) a sanctuary for criminals, mayhem, job-killing regulations, and failed socialist experiments, I have a modest invitation for you: MOVE TO DALLAS. You can call us the nation’s first official ‘Sanctuary City from Socialism.’”

“We value free enterprise, law and order, and our first responders. Common sense and the American Dream still reside here. We have all your big-city comforts and conveniences without the suffocating vice grip of government bureaucrats.”

As many Democratic-led cities joined a movement to defund their police departments, Johnson prioritized police funding and supporting law and order.

“Back in the 1800s, people moving to Texas for greater opportunities would etch ‘GTT’ for ‘Gone to Texas’ on their doors moving to the Mexican colony of Tejas,” Johnson continued, referring to Americans who moved to the Mexican colony of Tejas to acquire land grants from the Mexican government.

“If you’re a New Yorker heading to Dallas, maybe try ‘GTD’ to let fellow lovers of law and order know where you’ve gone,” Johnson said.

Modern-day GTT movers, including a large number of New Yorkers, cite high personal income taxes, high property taxes, high costs of living, high crime, and other factors as their reasons for leaving their states and moving to Texas, according to multiple reports over the last few years.

In response to Johnson’s invitation, Gov. Greg Abbott said, “Dallas is the first self-declared “Sanctuary City from Socialism. The State of Texas will provide whatever support is needed to fulfill that mission.”

The governor has already been doing this by signing pro-business bills into law and awarding Texas Enterprise Grants to businesses that relocate or expand operations in Texas, many of which are doing so in the Dallas area.

“Texas truly is the Best State for Business and stands as a model for the nation,” Abbott said. “Freedom is a magnet, and Texas offers entrepreneurs and hardworking Texans the freedom to succeed. When choosing where to relocate or expand their businesses, more innovative industry leaders recognize the competitive advantages found only in Texas. The nation’s leading CEOs continually cite our pro-growth economic policies – with no corporate income tax and no personal income tax – along with our young, skilled, diverse, and growing workforce, easy access to global markets, robust infrastructure, and predictable business-friendly regulations.”

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