[dvd-discuss] Media Tariff Proposal of March 9, 2002

["Arnold G. Reinhold" <reinhold(at)world.std.com>]

I am a United States citizen writing a Letter of Comment regarding 
the proposed new levies on recordable computer media and MP3 players.

As you know, the United States and Canada share a long and relatively 
open border. Much of the U.S. territory along that border is 
economically depressed. Your proposed media tariff is a significant 
step in improving that unfortunate situation.  As levies on 
recordable media rise to a level that in many cases will double the 
retail price, millions of Canadians will purchase these goods in U.S. 
electronics stores just across the border.  Note that recordable 
media is small and available in packages of 50 or more, so only one 
or two trips per year are needed.

The same is true of portable players for MP3 files, which  are 
extremely compact and are designed to fit in shirt pockets. Since the 
memory available in these devices continues to grow, your tariffs 
will soon become so prohibitive that these units will only be 
affordable when purchased abroad. For example, a 60 Gigabyte player's 
tariff would be CND$1260, far in excess of the expected retail price 
for such devices when they appear on the market in a couple of years.

My home  state, Massachusetts, is suffering from a severe government 
revenue shortfall. We receive many visitors from Canada and I'm sure 
few will return home without a package of CD-Rs or a new iPod. This 
will be a welcome contribution to our sales tax coffers.

I would also like to point out that there is a growing computer 
software industry in Canada which is competing with established firms 
in the U.S. Your proposal will help alleviate this potential strain 
in U.S-Canadian relations by taxing the blank recordable media on 
which your industry depends to ship products.  U.S. firms will not 
have to pay the tax even when they ship product to Canada, since by 
then the media will have been written on and rendered unrecordable. 
Better yet, since U.S. firms dominate the recorded music market, much 
of the money you collect from your software companies will end up in 
the hands of our recording industry.

You indicate in your notice that some aspects of this levy are 
mandated by the Copyright Act and that comments about them serve no 
purpose. But such sensitivity on the part of one country to the 
economic needs of another is most rare. Surely a simple thank you is 
in order. Perhaps your commission would be so kind as to forward 
these comments to the parliamentary  committee responsible for 
drafting this Act.

Your appreciative neighbor,

Arnold Reinhold
14 Fresh Pond Place
Cambridge, MA 02138 USA