Alternative federal budget 2026-27: Arts and culture

This is from a larger publication, Alternative federal budget 2026-27: Bridge to independence

Introduction

In this era of change, uncertainty, disrupted trading relationships, and U.S. threats to make Canada the 51^st state, Canada must have vibrant arts and culture, in every sector, and in every community.

Canada has many measures that support Canadian artists and producers, including funding, preferential treatment, content quotas and others. While these are not exclusionary, and Canadians freely enjoy cultural expressions from everywhere, the U.S. has challenged some measures. The U.S. is likely to seek removal of the cultural exemption in CUSMA.

Arts and culture are an important industry. In Artworks, the Canadian Chamber of Commerce October 2025 report found: the arts and culture sector contributed $65 billion in direct GDP to the economy in 2024; 507,000 people worked in arts and culture; the sector supports 13 jobs for every million dollars in output—more than oil and gas, manufacturing, or agriculture. The sector generates an estimated $17 billion in federal and provincial tax revenues. Accounting for total impacts throughout the economy, the sector supports $131 billion of Canada’s GDP and 1.1 million jobs across the country. In the past three years, the sector’s GDP contribution grew by almost eight per cent.¹ In 2024, Canada exported $27.1 billion of culture products.²

Based on these data, arts and culture seem to be strong. But there are growing challenges facing every component of the sector in 2026: rising costs, shrinking audiences, and changing distribution and business models. AI is a threat. There is more competition for stagnant public funding, and declining sponsorships and donations. At best, provincial funding is stagnant. Nova Scotia and Alberta recently cut arts funding significantly.

Artworks reports the sector generates $29 in economic activity for every dollar in federal government investment. But it also reports that, of total federal expenditures, the allocation to arts, culture and heritage was one per cent in 2023-24, 0.94 per cent in 2024-25 and 0.93 per cent in 2025-26. Additionally, total private sector contributions lag at 0.8 per cent of income, well below the global average of 1.04 per cent³.

The AFB brings a renewed commitment to supporting our arts, artists and culture, so we can tell our stories and hear our voices, in every medium. Telling our stories is more important today than ever. They reflect us to ourselves and to the world. They are tools for social cohesion, intercultural dialogue, social change, health and more.

Overview

It is a difficult time across the full spectrum of arts and culture activities—artistic creation, production, distribution and exhibition.

Overall, philanthropic/charitable giving is falling.⁴ The proportion of taxpayers claiming charitable donations was 26 per cent in 1997 and 16 per cent in 2024.⁵ Many arts service organizations with charitable status are feeling the impact. In the past few years, major corporate sponsors and donors to arts and culture have stepped away, even from longstanding commitments.

Audiences have shrunk in key areas. In 2018, there were 47,111 live performances across Canada that attracted 13.8 million people. While the low point was 2020, during the pandemic, a complete recovery may not come. In 2024, there were 37,821 live performances that attracted 10.3 million people.⁶ Live music venues and festivals are closing.

Telefilm Canada reported that, in 2025, box office revenues for French-language Canadian films were $11.3 million, a decline of 45.5 per cent, and box office revenues for English-language Canadian films were $2.9 million, up by only 0.2 per cent.⁷

Total film and television production in Canada declined by 18.5 per cent in 2023-24, primarily due to U.S. industry strikes. The industry rebounded in 2024-25, but only slightly. Total film and television production increased by 4.6 per cent. Alarmingly, that increase is related exclusively to foreign service productions. Total Canadian feature film and television production slipped by a further 2.2 per cent. The 2024-25 production volume of $3.62 billion was the lowest level since the 2020-21 pandemic shutdowns.⁸

In the book industry, overall sales of print books in 2025 were $1.145 million, up modestly from $1.127 million in 2024.⁹ The good news is that Canadian titles accounted for 14 per cent of print book sales, up from 12 per cent in 2024.

Canada’s magazines continue to struggle.¹⁰ The latest authoritative data show operating revenue fell by over 16 per cent between 2019 and 2021. Global figures show that consumer magazines’ revenue will decline by 2.1 per cent between 2021 and 2026. This decline is driven largely by the loss of print advertising revenue.

Canada’s private television and radio broadcasters remain a major source of shared cultural experiences, as well as local news and information. But Broadcasting in Canada 2025, a recent study by the Canadian Association of Broadcasters (CAB),¹¹ found that dominance of streaming has caused a structural crisis in the Canadian broadcasting industry. This report, and CRTC and Statistics Canada data, show that between 2005 and 2024, internet-based video services total revenue increased from $0.2 billion to $5.4 billion. Broadcaster revenue was virtually unchanged, increasing from $4.3 billion to $4.9 billion. Advertising in the broadcasting industry has undergone an even more colossal shift. Total internet-based advertising rose from $0.56 billion to $17.7 billion, while broadcaster advertising revenue fell from $3 billion to $2.6 billion.

These changes in broadcasting have shifted advertising dollars away from Canadian media companies to foreign-owned platforms. According to the report, non-Canadian platforms accounted for only 4 per cent of advertising in Canada in 2005. By 2024, the share is estimated to be 58 per cent. Broadcasters’ ability to support Canadian content has been affected by the breakdown of the traditional cross-subsidy model: broadcasters helped sustain Canadian programming through the profits of more lucrative U.S.-based programming. At the same time, Canadian consumers have moved away from traditional broadcasting services: the number of households subscribed to broadcasting distribution undertakings (primarily cable) dropped from 80 per cent in 2015 to 58 per cent in 2023.

The CRTC’s 2024 decision to impose a requirement on foreign streamers to contribute five per cent of their gross Canadian revenues to Canadian content productions was designed to stabilize opportunities for Canadian content producers. The requirement is modest and in line with measures in Europe and elsewhere. However, the streamers have challenged the decision in court. In an April 2025 poll conducted by Abacus Data for the CMPA, 83 per cent of Canadians would like to see greater investment in Canadian-made TV, film and digital content to ensure that more content, with higher production values, is available for audiences.¹²

In response to the challenges in film and television, the CRTC announced on May 21 that large U.S. streaming services must contribute 15 per cent of their Canadian revenue to Canadian content, three times greater than the initial requirement. At the same time, contribution requirements for traditional broadcasters, currently between 30 and 45 per cent, will be lowered to 25 per cent. CRTC expects that these changes will stabilize the funding at more than $2 billion in support of Canadian content.

The challenges in arts and culture are experienced differently in each sector, and are particularly felt by emerging artists, those from equity deserving communities, and older professionals who struggle to earn a living as a writer, singer, visual artist, dancer, actor, director, and other creatives behind the scenes.

The November 2025 federal budget increased arts and culture funding over three years. Given the challenges, the $443 million is only a down payment on what is required.

Actions

The AFB responds to the crisis in the arts and cultural industries by continuing to implement commitments the government has made, including amending the Copyright Act to provide a Resale Right.

The AFB will increase the federal refundable tax credit for artistic expressions to 35 per cent. Eligibility for the credit will be extended to producers of all forms of artistic expressions and cultural works. The credit is based on eligible labour expenses, including salaries, wages, fees, per-diems, and other compensation. Payments to artists and other creative talent are included.

Expanding the refundable tax credit programs to all sectors will encourage private investment in the production of cultural expressions. Canada currently provides refundable tax credits of up to 25 per cent for qualified labour expenditures through the Canadian Film or Video Production Tax Credit and the Film or Video Production Services Tax Credit. Several provinces provide complementary credits for producers of films and television programs, and some have similar incentives for digital media and animation productions. Québec also offers refundable tax credits for producers of live performances, and Ontario provides refundable tax credits for book publishers. The federal credit will now be provided to eligible Canadian producers of films, television, digital media, animation, live performances, books, magazines, visual arts, crafts and other forms of artistic expressions and cultural works.

The federal government will work with the provinces to ensure the tax credit programs are complementary, effective, and sensitive to the needs of specialist producers/publishers creating culturally significant works.

The AFB will increase $100 million in funding annually to the Canadian Council for the Arts to:

Implement programs for Indigenous, Black, gender-diverse, and older artists, artists with disabilities, as well as artists from other marginalized and equity-deserving communities.
Increase support to culturally significant works.
Provide additional operating grants for arts service organizations.

The AFB will continue to increase CBC/Radio Canada funding until it matches the average per capita investment that public broadcasters in other countries receive. In 2024, the government needed to increase CBC’s budget by $2 billion to reach that average.¹³ The recent budgetary increases given to the CBC are only a down payment toward the goal. CBC’s total funding includes 22 per cent advertising revenue and, as further increases are made in the coming four years, CBC will implement a timeline to eliminate advertising.

The AFB will provide targeted measures to support professional artists. At the heart of the sector are professional artists: writers, musicians, performers, designers, visual artists, composers, dancers, editors, singers, storytellers, directors, choreographers, artisans, craftspeople and more, in every community and in every medium.

There are more than 202,000 professional artists, roughly one per cent of the labour force.¹⁴ But artists are the original gig workers. Historically, the median individual income of professional artists is around 44 per cent lower than all Canadian workers.¹⁵

The AFB will amend the Income Tax Act to ensure professional artistic income up to $10,000 will be eligible for a refundable tax credit of 15 per cent. This credit will be reduced to 7.5 per cent for artists whose total family income exceeds the median of all artists. It will be eliminated for artists whose total family income exceeds the median of all workers.¹⁶ This credit creates a powerful incentive for creativity for artists who are struggling to earn a living from their art. The definitions and controls are provided in Income Tax Folio—S4-F14-C1, Artists and Writers, and in the Status of the Artist Act. When the Canada Liveable Income (CLI) is fully implemented (see Poverty and income security chapter), the refundable tax credit will be reviewed.

The AFB will ensure tax fairness for professional artists by allowing artists to back average their income over four years. Visual artists may prepare works for many years before these are exhibited and sold. A writer may spend many years on a script before it is made into a movie and generates income. But the income these artists receive will be taxed in the year it is received. Depending on residency and total income, they could pay up to 16 per cent more tax than if it were spread evenly over the years during which it was created.¹⁷

Many artists and related cultural workers must work at jobs outside the sector between their artistic contracts. When they do, they and their employer will pay into the Employment Insurance (EI) program. But when they are without any work (either as an artist or the other employment), many cannot collect EI regular benefits, even if they otherwise qualify.¹⁸ The AFB will ensure the Canada Employment Insurance Commission develops regulations to bring professional artists fully and equitably into the EI system. Professional artists and engagers will pay premiums, and the artists will qualify for regular benefits according to a model based on total income earned in four-week periods, rather than four-weeks worked. It is anticipated this model will be neutral, except in extraordinary circumstances, such as a pandemic. It may become a model for extending EI benefits to other self-employed gig workers.

The Monitor

Our Schools/Our Selves

Alternative federal budget 2026-27: Arts and culture

Introduction

Overview

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About the author

Alternative Federal Budget Working Group

Alternative federal budget 2026-27: Health care

Alternative federal budget 2026-27: First Nations

Alternative federal budget 2026-27: Health care

Alternative federal budget 2026-27: First Nations

Budget fédéral alternatif 2026 : Arts et culture

Alternative federal budget 2026: Arts and culture

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