U.S. Asks for WTO Ruling on Canadian Magazine Tax

U.S. Trade Representative Mickey Kantor said Monday that the United States has asked the World Trade Organization to rule on a U.S. complaint that Canada is unfairly shutting U.S. magazines out of its markets.

The case involves an 80% tax on advertising in U.S. magazines that publish special editions in Canada. The tax, Kantor’s office said, was designed to prevent Time Warner Inc. from publishing a Canadian edition of Sports Illustrated.

In Ottawa, Canadian International Trade Minister Art Eggleton vowed to fight the U.S. complaint.

“To us it’s an important cultural issue,” Eggleton said.

The magazine tax is one of a number of disputes between the U.S. and Canada over cultural issues.

Kantor told reporters that arguments about cultural identity are an excuse to “protect the financial and economic viability of the Canadian industry.”

Eggleton said the commercial viability of Canadian industry is part of protecting the country’s cultural identity.