The Vancouver Scrum

In some sort of modern-day speed record for government action, the BC government has decided that yes, the Georgia Straight is a newspaper. Via cbc.ca:

VANCOUVER - The provincial government has changed its mind about the Georgia Straight, and now says the Vancouver weekly is clearly a newspaper.

The province had stripped the Straight of its sales tax exemption and slapped it with a $1-million tax bill, claiming it contained too much advertising to qualify as a newspaper. Revenue Minister Bill Barisoff says the government will now review its taxation policy to avoid similar confusion in the future.

... which makes everything in my previous posting irrelevant.

Okay, so that's dead cheesy. However, the Georgia Straight, Vancouver's alternative weekly-turned-establishment rag, is in some hot water. This week, a provincial government auditor took ruler and calculator to the paper and determined that it had less than 25% editorial content. Going under that magic number means that the Straight is no longer exempt from Provincial Sales Tax. So the government's slapped them with a $1-million back tax bill (which Straight publisher Dan McLeod calls a "fine.")

So the controversy is around whether or not the paper's events listings are editorial content or not. Seems to me that they can't be called advertising; the Straight doesn't charge for listings. Now, even if you count the listings as editorial content, the Straight has barely been over the 25% mark lately. Most issues are around 120 11" x 17" pages, with classified and display advertising taking up about 90 pages.

Dan McLeod was loudly alleging in this week's Straight that the BC "Liberal" government is conspiring to shut the paper down for its consistent opposition to the government. He backed down some yesterday, saying instead that, "I don't have proof, but I can feel it in my bones that this is political"at a press conference yesterday.

(Ed's note: Hey Danny! Most of the college papers haven't been kind to El Gordo; neither has that other Vancouver weekly to which I contribute. The government hasn't been after all those other papers critical of Campbell -- maybe because we run a hell of a lot more content relative to advertising? In any case, the Straight has NOT been the only paper that regularly takes the editorial boots the the Campbell government. Got it?)

Here's a bit of what I do know. Currently, the Straight is perhaps 30% editorial including Time Out, 70% adverts -- sometimes the advert percentage is even higher. There has been some talk that they were moving to an 80-20 advertising/editorial split, which would clearly make the Straight ineligible for sales tax exemption.

Most of the free weeklies out there (think the Stranger, LA Weekly, Hour, etc.) run about 60% advertising, sometimes a little higher.

While this move by the provincial government does seem inane, I do have a bit of trouble having any sympathy for Dan McLeod. He's not exactly running a shoestring operation over there at 1770 Burrard. As it stands, the Straight gobbles up much of the print advertising in Vancouver, leaving the rest to fight for scraps. Most of the Straight's advertisers, both display and classified, are on multiple-insertion deals, so their cash flow is predictable. With the amount of advertising that he sells, a total of 90+ pages/week, you'd think that he could run more actual content (or just pick up stuff from Alternet for dirt cheap) in his paper and still run a healthy profit.

It's also curious how McLeod has, in the last two days, frequently referred to community rags being stuffed to the gills with flyers. The Straight has certainly not had any qualms about doing the same -- and flyers aren't part of the calculations for what makes a newspaper a newspaper for sales tax purposes.

Well, in weigh the pundits.

Vancouver Sun provincial-affairs columnist Vaughn Palmer's not much impressed with the government's moves, essentially saying that the law is rubbish.

If a regulation can be reasonably construed to say it is not, then the regulation is an ass and should be rewritten.

On the other hand, the editor of Terminal City Weekly, one Reverend L. Ron Moonbeam, is less impressed with the Straight's plight after they've been going for so many years with so many ads and relatively little content interspersed. Conflict declared: Yes, I do write for TCW. No, I do not necessarily share the views of my editor, nor does he expect me to share them.

Backgrounder: Information sheet from the province of BC on sales tax exemptions for newspapers.