Canada May Tax Legal Music Downloads

FuriousBalancing writes "MacNN is reporting that Canadians may soon pay a small tax on every legal music store download. This fee is the work of a measure proposed by the Copyright Board of Canada. About two cents would be added to every song downloaded, with 1.5 cents being added to album downloads. Streaming services and subscriptions would also be taxed, to the tune of about 6% of the monthly fee. Most interesting - the tax would be retroactively applied to every transaction processed since 1996. 'The surcharge would help compensate artists for piracy, according to SOCAN's reasoning. The publishing group draws similarities between this and a 21-cent fee already applied to blank CDs in the country; the right to copy a song from an online store demands the same sort of levy applied to copying a retail CD, SOCAN argues. The tax may have a significant impact for online stores such as iTunes and Canada-based Puretracks, which will have to factor the amount both into future and past sales.' The full text of the measure is available in PDF format."

Comments

WTF?

[rm999]

"The surcharge would help compensate artists for piracy"

So now we are taxing law-abiding citizens to make up for those who break the law? Is it just me, or does this *promote* piracy?

Re:WTF?

[rsmith-mac]

It doesn't even immediately make sense. Until very recently major label music was DRM'd, which effectively prevented most casual piracy. I could potentially see streaming radio used as a piracy source, but that's only for MP3 streams, and then those guys do a number of things to discourage piracy.

Is there something I'm missing here? How can you tax someone for piracy when they're unable to use the taxed items to reasonably commit it?

Re:WTF?

[monkaru]

In theory there is no reason to DRM music in the Canadian market as copying is legal when a levy is paid on media and downloaded music from on-line stores would also be legal to copy hence the tax. It's a case of a much larger country having Draconian copyright laws while a smaller neighbour goes at the issue in an entirely different way. Obviously, American labels aren't about to make an easy to copy version for the Canadian market.

A tax on not committing piracy

[Anonymous Coward]

Because of the health costs of tobbaco, Canada is proposing a new tax on non-smokers.

Re:A tax on not committing piracy

[BlueStrat]

Treatment of a smoker is even more expensive then the longer life of the average non-smoker, and there are plenty of sources to back it up. Google pulled up these articles:
http://www.cdc.gov/MMWR/preview/mmwrhtml/mm5114a2.htm
http://www.bera.com/smoking.htm

Diamondmagic, this isn't aimed at you personally, but I feel I have to say a few things here.

~rant on

This is what I hate about strident anti-smoking groups and individuals. You could say the same about a multitude of perfectly legal accepted behaviors.

What about over-eaters? Those that participate in risky sports? People who work really hard at their jobs? Explorers? Astronauts? Scuba divers? Mountain climbers? Consumers of alcohol? Those that choose to live in high-crime areas? What about those irresponsible people that go outside in cold weather without a hat and heavy enough coat? Those that don't have an exercise regimen? Meat eaters? Those that (in someone elses' opinion) spend too much time at a computer/surfing the net/playing games that some may consider harmful?

How about people who deliberately expose themselves to harmful ultraviolet radiation to get a tan? Driving or traveling by automobile is one of the riskiest common behaviors, and far surpasses the costs to society of tobacco, even considering the insurance required of drivers in most states.

I flatly refuse to believe all these 'secondary-smoke' alarmist advertisements, stories, and studies. They fly in the face of common sense, and I believe they are constructed as a reason to further regulate and legislate behaviors for the sake of politics power and money. They rarely work as "intended", witness Prohibition and the "War On Drugs", but usually succeed at expanding government power and reducing individual rights.

It is the nature of humans to engage in risky behaviors, even those that they know are harmful to themselves. The only way to stop it is to put everyone in a Matrix-type tube of goo for their entire lives.

Sure, by all means make sure people understand the risks, and try to place minimal, well-reasoned, and practical restrictions that are agreed to by the majority on the extremes, but drop the idea that you can or should try to regulate through law and taxes every behavior that someone thinks may be harmful, for it may be something that matters to *you* that may be the next crusade of the behavior-gestapo.

~rant off

Strat

Theoretically Speaking

[ChromaticDragon]

Just how do we get connected to this gravy train?

Can we just churn out some simple recordings, demonstrate it's theoretical pirating rates and call up somewhere to get some dough?

That would suck

[CastrTroy]

If they started implementing this, I would probably just have to stop buying music altogether. It's getting way too annoying for me to buy music without being ripped off by the industry. I use eMusic to buy my music, and if I had to pay this extra fee, I would cancel my account, and let them know exactly why. If enough online music stores had enough customers quit, then I think that the backlash from these companies would make the government change their mind about this kind of stuff. Also, trying to make things like this retroactive, would make it even worse. The industry complains that people are pirating music, and then hits their customers with crap like this. I've gone completely legit for the last few years, because I feel that it's right to support the artists, but stuff like this makes me want to go back to downloading everything over IRC. If they are just going to assume that we are pirating all their content, we might as well do it, because they certainly don't deserve our money.

Has anyone followed up?

[QuietLagoon]

The surcharge would help compensate artists for piracy, according to SOCAN's reasoning. The publishing group draws similarities between this and a 21-cent fee already applied to blank CDs in the country

Has anyone ever followed up to see just how much of the 21-cent fee actually makes it back to the artists, and how much is sucked up by the record company cartel?

Re:Has anyone followed up?

[monkaru]

Interestingly, the CRIA has refused to collect the money. So, there are billions in artists money sitting uncollected.

Except . . .

[SquareOfS]

The analogy is to the levy on blank CDs? The tax is because the downloaded music can be burned to a blank CD on which you've already paid a tax because you might burn music to it?

In related news, Canada proposed a tax on blank paper, by analogy to the sales tax which applies to books. "Someone might read what's written on the paper someday, and we won't then have the opportunity to collect the tax."

tax legal?

[Anonymous Coward]

They should tax the illegal downloads, that is where the money is!

Ex Post Facto Laws

[kalidasa]

A retroactive tax an ex-post-facto law. If this were the US, that part of the law would be unconstitutional on its face, article I, section 9, paragraph 3: "No bill of attainder or ex post facto Law shall be passed." But of course, it's Canada, and the Charter of Rights and Freedoms only affects criminal retrospective laws (and section 33 can be used to obtain a 5 year mulligan if it is). BUT I AM NOT A LAWYER, so maybe I'm wrong (but I may be right).

$0.02

[Anonymous Coward]

So now they want my two cents worth as well, eh?

It is NOT piracy in Canada!

[John Jamieson]

I have mod points I would love to use, but I have no chance because no one is correcting the Myth of Piracy.

In Canada it is NOT piracy to copy a song for personal use. It is not stealing, it is not copyright infrigement. It is a right granted by law, a law that was encouraged by the music industry back in the Audio Cassette days. Yes, they now regret it... too bad!

Re:It is NOT piracy in Canada!

[monkaru]

Yes, you are exactly right. I'm not too happy with the spokesperson the copyright board used for this annoucement because the did a very bad job of explaining exactly what is meant by "copying" in Canada. As you say, copying music to levied media is not piracy but legal copying and the levy on on-line music would allow the copying of downloaded files more than once. Giving a copy to your mom for example. However, DRM routines may make most downloads not easily copied anyway but might make an interesting court case should someone purchase levied music on-line and discover the files are altered in a manner that prohibits or makes very difficult legal copying. Legal copying they have paid for. Could get interesting.

Re:It is NOT piracy in Canada!

[ceoyoyo]

Actually they've been demanding that the copyright law be changed to prohibit copying. They were even willing to scale back the levy to get it, but the copyright board still told them where to go. So now they're trying the next best thing -- more levies!

As ludricrous as it is unethical

[seanthenerd]

So until now, we could assume that when we bought music from iTunes et al., a certain amount went to that company and a certain amount went to the artist. According to a record-producing-artist friend of mine, he actually gets a very decent cut as an indie artist with iTunes (especially considering the lack of material+hosting costs). Now, with this tax (considering that it goes to SOCAN, I'm not sure if that is even the right word), iTunes will get the same cut, SOCAN will get 3% or so, and the artist will get the rest - which is less going to the artist than before (assuming that iTunes doesn't up their prices, but if they do, the same holds true because less people will buy, meaning still less for the artists.) By applying this, isn't SOCAN stealing from the artists?! As in *money* stealing. SOCAN is supposed to represent Canadian artists (by collecting radio royalties and so forth). How on earth does this help their members?! Ludricrous.

It would be comparable, I guess, to SOCAN collecting a tax on CD purchases. The whole beauty of internet distribution is getting rid of (or reducing the number of) middlemen. This is destroying every incentive people have to *support the artist*, which seems completely against what the whole point of SOCAN was. So if I make a band and sell my music using paypal, do I have to write cheques giving 3% of my profits to SOCAN? What am I getting from them? How does this help the artists? How does this help the industry? *

Down with middlemen.

* "While no public responses have been made, the Copyright Board report notes that both Apple and the RIAA-equivalent Canadian Recording Industry Association were heavily involved in resisting proposed rates."
So even the CRIA's against it. Who the heck is SOCAN representing?

Yeah, this makes sense!

[Jugalator]

So you get taxed for not supporting the music industry if you do support the music industry?
And you don't get taxed for not supporting the musics industry if you don't support the music industry?

Yes, this makes perfect sense! Thanks for this proposal.
I wholeheartedly support it. I can now much easier choose my proper action here and whether I should purchase legal music or not.