Taxes on blank CDs going up by 40%
The levy on blank CDs that allows Canadians to make legal copies of music is going up by almost 40 per cent, which only worsens the problem with the tariff, said one copyright expert on Tuesday.
The Private Copying Tariff for this year and next is going up to 29 cents from 21 cents per CD or MiniDisc, while the rate for audio cassettes remains at 24 cents.
It's the first increase since 2001, but critics argue the levy was already excessive.
A spindle of 50 blank CDs that sells for $35 is marked up by almost a third because of the tariff.
But blank DVDs, which have almost seven times more storage space than CDs, are cheaper per disc because they aren't subject to the tariff, which makes little sense, said copyright expert Michael Geist.
"The 29 cents is so much relative to the price of the CD that Canadians have either turned to blank DVDs instead … or they buy outside the country," said the University of Ottawa professor and Canada research chair of internet and e-commerce law.
"Increasing the levy without addressing the root problems I think only exacerbates the problem."
Critics also complain the tariff is unfair because it's built into the price of all blank CDs, regardless of whether they'll be used for copying music or other files.
But the Canadian Private Copying Collective applauded the decision and said the increase is needed, especially given the current economic climate and threatened cuts to arts funding.
"It is of even more importance that rights holders receive the compensation to which they are entitled," Annie Morin, chairwoman of the organization's board of directors, said in a statement.
The group has also petitioned unsuccessfully to have additional levies added to the price of digital memory cards and digital audio recorders and MP3 players.
The Copyright Board of Canada, which sanctioned the increase, said the levy would continue to generate about $30 million annually, as it has in recent years.
The quasi-judicial tribunal has said in the past that it does not wade into the debate about whether downloading on peer-to-peer networks should be interpreted as legal in Canada.
But it has said that it's legal for Canadians to make copies of music onto CDs — as long it's for their own personal use — although "other copyright considerations certainly apply."
"The CD copy that has been made by the end user is a legal copy," regardless of whether it contains illegally downloaded music, said Claude Majeau, secretary general of the copyright board.
"The (legality) question of downloading and sharing of music files — that's beyond our jurisdiction."
Geist said there needs to be better clarification of what consumers' rights really are.
"There are consumers out there who are paying tens of millions of dollars and they get the music industry basically saying they're not permitted to make the copies they feel they've paid for," he said.
"The recording industry has been consistent in trying to muddy the waters and make claims that all downloading is somehow illegal, despite the presence of the levy."
About two-thirds of the levy's revenue goes to the Society of Composers, Authors and Music Publishers of Canada; the Canadian Mechanical Reproduction Rights Agency; and the Society for Reproduction Rights of Authors, Composers and Publishers in Canada for eligible authors.
Some of the money also goes to the Neighbouring Rights Collective of Canada for eligible performers.