Monday, December 24, 2007

Ipod tax coming back?

I'll admit I'm not a big fan of taxes on digital music players. Yes I am aware that there is an external cost because people use them to steal music. However, unlike a carbon tax, the Ipod tax punishes you BEFORE you impose a cost on other people. It treats you as automatically guilty.


Consumers could potentially be hit by a new tax on electronic storage devices such as iPods and blank memory cards in 2008.

The federal Copyright Board has given its approval for a special levy on iPods and other digital players because they can be used to copy movies and music.

The Canadian Private Copying Collective, the non-profit agency that represents the music industry, wants to make sure that artists get compensated.

Small tariffs are currently in place for such items as rewritable CDs and cassettes. The CPCC first requested a levy on removable electronic memory in its 2003-2004 tariff proposal.

The Copyright Board initially concluded that there was insufficient evidence to warrant a new tax; however, the CPCC noted the growing popularity of digital memory devices is cause for concern. A hearing in April will reexamine the proposed levies.

"Our surveys show the vast majority of copies that people put on their iPods come from sources other than legitimatly purchased copies," said David Basskin, the Director of the CPCC.

According to a CPCC media release, "During the period from July 1, 2005 to June 30, 2006, 25 per cent of all the content copied onto electronic memory cards, including cards of all formats and capacities, was music, and 14 per cent of respondents copied only music."

The proposed levies range in price including:

  • 85 cents for rewritable CDs and MiniDisc
  • $2 for 1 GB removable electronic memory cards
  • $25 for a digital audio recorder between 1 and 10 GBs
  • $75 for digital audio recorder of more than 30 GBs

Don Butcher, the Canadian Library Association's executive director, says the CLA is concerned over the proposed levies because they assume illegal behaviour on the part of consumers.

"It's almost de facto criminalizing all Canadians. We just don't think that's right. The whole issue of those tariffs on blank media makes an assumption we think is a faulty assumption," he said.

"We don't think Canadians are out there deliberately infringing on people's copy right. We think that in fact Canadians are law-abiding."

John Williamson of the Canadian Taxpayers Federation says the measures may be counterproductive.

"Normally, you do the crime and then you do the time. In this case the government is going to hit us first so people will asume it's OK to download music without paying for it," Williamson said.

The surcharge won't come into effect immediately. Retailers are fighting the tax in court, saying the Copyright Board has no right to impose an extra fee on top of the price of iPods and other audio players.

Get the full version here

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