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Saturday, December 13, 2003
Copyright Board of Canada adds tax on MP3 players


If you're Canadian and planning on buying an MP3 player anytime soon, you'd better get moving.

A price increase of between $2 and $25 will come into effect after the Copyright Board of Canada gave the go-ahead Friday on a new levy for digital audio recorders, including Apple's hot-selling IPod. The move is part of several efforts underway to combat music downloading and copying.

As representative of the music industry, the Canadian Private Copying Collective went to the Copyright Board earlier this year seeking higher levies on recordable devices.

The group, which collects the tariffs on behalf of performers, songwriters and music producers, argued that more money was needed in compensation for the widespread practice of downloading and burning music.

While it won a tariff on MP3 players, the collective was denied its request to have blank DVDs, removable flash memory cards and removable micro hard drives added to the list of taxable items.

As well, the board froze levies on cassettes, minidisks and blank CDs until the end of 2004. The copying collective had wanted these levies increased - in some cases, doubled.

The collective said it was disappointed about the freeze. As well, the MP3 levy was far lower than the $1 per megabyte the organization had requested.

A $2 tariff will apply to recorders with up to one gigabyte of memory, $15 for those with up to 10 Gb and $25 for those above 10 Gb.

Consumers won't notice the increased levies on MP3 players immediately. The tariff is applied by the manufacturer, so any stock now in stores isn't affected.

Manufacturers, who had feared a high levy would create a black market for the players, said they were pleased with Friday's decision.

However, cheques to artists, songwriters and music publishers have yet to be issued, infuriating some organizations who say the levies aren't the solution to the music industry's woes.

The 70,000-member Society of Composers, Authors and Music Publishers of Canada is arguing before the Supreme Court of Canada that since practically everyone downloads music, Internet service providers should pay a blanket royalty fee.

A decision is expected next year.


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