Week in Insights: Canada’s ‘Link Tax’ Can’t Replace a Real Tax

Curated by Daniel Xu

Late last month, Alphabet Inc.'s Google brokered a deal with the Canadian Radio-Television and Telecommunications Commission to pay CA$100 million (about $74 million) annually to be exempted from the Online News Act—often called a “link tax.”

But it isn’t a tax at all; it’s a requirement that search engines and social media platforms that return news results bargain with news outlets for the privilege. Unlike most traditional taxes, the payments will directly target support for news businesses.

The link tax is more like a regulated negotiation process akin to intellectual property licensing. If ...