Will the Government Take Action Against the Memory Card Tax?

ACTRA is in Ottawa this week for a two-day lobby campaign on issues such as cultural funding and copyright. The group will undoubtedly focus on extending the private copying levy to iPods, an issue it has raised in the past. While there is seemingly no prospect of extending the levy to iPods, the question now is whether the government is prepared to take action against the plan to extend it to memory cards.

The Copyright Board of Canada recently established the timing for the hearing on extending the private copying levy to electronic memory storage devices such as SD cards. The hearing will not start until October 2012, but the time for the government to act is now. Given its opposition to the “iPod tax”, it is hard to see how it can possibly support extending the levy to SD cards and other storage devices. In fact, last year Canadian Heritage Minister James Moore specifically referenced memory cards in a debate on extending the levy:

This idea of imposing a new tax on iPods and MP3 players is not a new idea because there are very few new ideas, unfortunately, that come from the opposition on the issues of copyright and taxes. However, this idea is really toxic and, frankly, really dumb. This would punish consumers if we were to put in place a tax of up to $75 on iPods, Blackberries, cell phones, laptops, computers, memory sticks and automobiles, anything that is capable of playing digital music.

It turns out the Canadian Private Copying Collective provided the government with a roadmap for how to stop the memory card tax. As part of its submission to the Bill C-32 committee, the CPCC stated:

No Basis for Fear of a Levy on All Devices with a Hard Drive or on Any Inappropriate Device

The Act also makes provision for the Governor in Council to limit the scope of qualifying “devices” by regulation. Specifically, the definition of “audio recording medium” at section 79 of the Act permits the Governor in Council to prescribe by regulation that a particular type of “recording medium” is not an “audio recording medium”.

The process set out in the Act is one that would provide advance notice of any medium or device on which the CPCC wished to collect a levy. The CPCC must file a proposed tariff by March 31st of the year prior to the year in which the levy would come into effect. If the CPCC sought a tariff on a device deemed inappropriate, the Governor in Council could issue a regulation that prevented the Copyright Board from considering such a request. There is, therefore, no legitimate basis for fear that a levy would be imposed on all devices with a hard drive or on any device to which a levy should not apply.

Moore is already on record in describing extending the levy to memory cards as a “toxic” and “dumb” idea. The issue is now whether – as the CPCC suggests – the Governor in Council will issue a regulation preventing the Copyright Board from considering the request.

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