The amount of the tax will be levied on a sliding scale according to the size of the player’s memory. Canadians will have to pay $1.50 for units with up to 1 gigabyte of memory, $11.25 for 1 to 10 gigabytes, and $19 for players with more than 10 gigabytes. 

The tax will apply to all new imported and manufactured players, so if you had your eye on that iPod, you better rush to the store and buy it before they have to restock. 

The move was taken to help compensate Canadian musicians for their work. MP3 players will join blank tapes and CDs which are taxed to help make up for lost royalties that occur when people copy rather than buy music. Canada instituted the tax on blank tapes and CDs in 2000. 

The board declined to pass the new tax provisions for blank DVDs, removable memory cards and removable micro hard drives. 

There are now more than 40 countries that tax blank media, the United States is not one of them. That fact is what Canadian merchants fear. The fear that Canadians can simply drive across the boarder and purchase the MP3 devises without having to pay the added tax. 

This ruling could also have an effect on a case heard by the Canadian Supreme Court last month that tackled the online royalty issue from a different angle. If that case goes through, Canadian Internet service providers will have to pay blanket royalties to compensate musicians for music that is downloaded off of the net. The court will also decide if Canadian copyright law can be expanded to offshore Web sites that serve Canadians. 

The court is expected to hand down their ruling in that case early next year. 
 
 

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