Canadian copyright levy on blank audio recording media

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The "Blank CD-R Tax" FAQ

WARNING!! This page has not been updated since Monday, December 15, 2003 and thus is completely out-of-date!!!

to see even older out-of-date FAQ pages go here, or here, or here, or here, or here

For current information about the Canadian copyright levy see:


The current levy on CD-Rs is 21¢ each.

The new levy for non-removable memory permanently embedded in digital audio recorders is $25 for each recorder with memory capacity of more than 10 gigabytes.

Direct link to the levy tables

Changes: link to external MP3 player table added 2003-12-16, retroactivity added 2003-12-16


I have heard that the Canadian Government is taxing blank CD-Rs - is this true?

No, there is no tax, but yes, there is a levy (see the difference below).

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What is a levy?

On March 19, 1998, new federal copyright legislation came into force. Among other things, the legislation provides for a levy to be collected on blank audio recording media.

It is called a levy (and not a tax) because it is not collected by any level of government, it is collected by a group representing the recording industry. In a letter to the Copyright Board of Canada released Monday, January 18, 1999, the five collectives that filed tariffs for a proposed levy on blank audio recording media announced the creation of the Canadian Private Copying Collective (CPCC).

The Copyright Board decides on the amount of the levy and what media it applies to. The CPCC submits its proposed levies and the Copyright Board holds hearings to hear any objections to the proposed levy amounts. Note that the Copyright Board CANNOT change the law, they can only determine the levy value and the media to which it will apply. The levy can be set for a 1- or 2-year period. So far, all of the periods set and requested have been 2 years.

The first time the Copyright Board set the levy was December 17, 1999.

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What other countries collect a levy like this? Is Canada alone?

At least 25 countries, including most G-7 and European Union members, have introduced comparable regimes with respect to the private copying of sound recordings. Canada is one of the last to do so.

The USA is often held out as an example of a place where "this could never happen", but as far as I can tell, it has been law there since December 8, 1994. It is part of Title 17, section 1004, and if you go to:

you will find this paragraph:

Note, however, that in the US there is NO levy collected on "ordinary" CD-Rs When the legislation was last changed (in 1994/1995) CD-Rs were not seen as a media intended for copying music. There IS a levy applied to other digital media, such as DAT and CD-R Audio.

In a posting to news://alt.comp.periphs.cdr on Sat, 18 December 1999 19:25:25 +0100, Sybren <> wrote the following (edited for length):

"We have this kind of thing here in the Netherlands since 1 September '99. To clear some things up:

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I am just visiting Canada. Can I legally make private copies here?

A non-Canadian visiting Canada can make a private copy of a CD (even one he brought with him from a foreign country) and he will not be infringing copyright in Canada. His home state might consider the copied CD an infringing copy when he returns.

A Canadian making a private copy of a CD in another country could be infringing copyright in that country.

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Can I legally copy music CDs for my friends?

The simple answer is NO, but you can legally copy your friend's music CD for YOUR OWN use.

To paraphrase the introduction to an early Copyright Board ruling:

It does not matter whether you own the original sound recording (on any medium), you can legally make a copy for your own private use.

To emphasize this point, endnote 4 of an early Copyright Board ruling says:

Note that the Copyright Act ONLY allows for copies to be made of "sound recordings of musical works". Nonmusical works, such as audio books or books-on-tape are NOT covered.

The wording of the Copyright Act gives rise to some very odd situations. In the 6 examples below, "commercial CD" means a commercially pressed CD that you would normally buy at a retail store.

  1. If someone steals a commercial CD, steals a blank CD-R, and then copies the commercial CD onto the CD-R, they are a thief, but they have not infringed copyright.
  2. You can legally lend a commercial CD to a friend, give him a blank CD-R, let him use your computer, and help him burn the CD-R which he can keep for his own private use.
  3. You can legally copy a commercial CD , keep the copy, and give your friend the original.
  4. You cannot legally make the copy yourself and give your friend the copy.
  5. Your friends Alice and Benoit really like the new commercial CD you just purchased. Alice borrows it and makes a copy for her own use. She then passes the commercial CD on to Benoit, who makes a copy for his own use. Benoit gives the commercial CD back to you. This is all perfectly legal.
  6. However, if Alice had copied the commercial CD, given it back to you, and passed her copy on to Benoit to make a copy for his own use, then copyright would have "probably" been infringed. There is some doubt here because Alice's original intent is important. In the strictest terms, her copy was no longer just for her private use. Pretty strange considering that the end result of examples 5 and 6 are exactly the same!

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Can I legally share music over the internet?

The simple answer is NO.

If you post a song on the internet, or make it available to others via a peer-to-peer network, or if you send it to someone as an email attachment or via FTP, you are considered to be making a public transmission of the work. It is also clearly not for your own private use. You would be infringing copyright unless you had explicit permission from the rights holders.

However, unless the legislation is changed or the courts interpret matters differently, it appears that making a private copy for your own use of a musical work downloaded in any manner from the internet is not an infringement of copyright. In their decision, the Copyright Board states:

The regime does not address the source of the material copied. There is no requirement in Part VIII that the source copy be a non-infringing copy. Hence, it is not relevant whether the source of the track is a pre-owned recording, a borrowed CD, or a track downloaded from the Internet.

The more complex answer to the question posed above is you cannot post a song on the internet in any manner, but you can make a private copy of any songs you find on the net.

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Can I make private copies of movies, audiobooks, or software?

NO. The Private Copying Regime only addresses making private copies for your own use of sound recordings of musical works.

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Is there a government website that explains all this?

The Copyright Board did not have a website until early December 1999, which is part of the reason for this page. You can find their website at

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Will the Copyright Board answer my questions?

In my dealings with them, the Copyright Board has been very cooperative and open. However, they do have a very small staff and they may not be able to respond as quickly as you expect. Many of the questions people have are answered on their website at

I first contacted the Copyright Board by phone in late 1998 and had a very informative conversation with Mr. Mario Bouchard, General Counsel to the Copyright Board. He was kind enough to send me the equivalent of a FAQ via email. I have formatted it in HTML and placed it on this website.

Any time I have asked a question of the Copyright Board, I have received a prompt answer.

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When does this become law?

It has been law since March 19, 1998.

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When did the levy start? When will it change?

The levy started December 17, 1999. The levy is set for a period of 1 or 2 years and the law enabling the levy allowed it to start January 1, 1999. The next possible change would be January 1, 2005.

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Are the 2003-2004 levies retroactive?

The levies for 2003-2004 were announced in December 2003, long after the January 1, 2003 effective date. However, the Copyright Board had announced an interim levy to remain in effect between the expiration of the 2001-2002 levy and the announcement of the 2003-2004 levy. This interim levy simply continued the 2001-2002 levies for the intervening period.

The only new levies annouced are those which apply to MP3 players and similar devices. Despite the fact that the levies on these devices could be collected retroactively to January 1, 2003, the CPCC has undertaken only to begin collection of these new levies as of December 12, 2003.

So the short answer is, NO, the new levies are not retroactive ("old" levies covered by the interim decision will still be collected).

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What is the amount of the levy?

The amount depends on the media in question, as shown in the following tables.

Table 1 shows the current levy (2003-2004), the levy proposed by the Canadian Private Copying Collective (CPCC) on February 11, 2002 for that same period prior to the Copyright Board ruling, and the previous levy granted for 2001-2002.

Table 2 shows the previous levies.

TABLE 1: Current levies




Audio cassettes 40 minutes or more in length 29¢ each 60¢ each 29¢ each
CD-Rs and CD-RWs 21¢ each 59¢ 21¢ each
CD-R Audio, CD-RW Audio and MiniDisc 77¢ each $1.23 77¢ each
Removable electronic memory card, removable flash memory storage medium of any type, or removable micro-hard drive no levy 0.8¢ per megabyte not covered
DVD-R, DVD-RW, DVD+RW, DVD-RAM or any other type of recordable or rewritable DVD no levy $2.27 each not covered
Non-removable memory (memory of any kind including hard drive or flash memory) permanently embedded in a digital audio recorder that can record no more than 1 gigabyte of data $2 per recorder $21 maximum (2.1¢ per megabyte) not covered
Non-removable memory (memory of any kind including hard drive or flash memory) permanently embedded in a digital audio recorder that can record no more than 10 gigabytes of data $15 per recorder $210 maximum (2.1¢ per megabyte) not covered
Non-removable memory (memory of any kind including hard drive or flash memory) permanently embedded in a digital audio recorder that can record more than 10 gigabytes of data $25 per recorder over $210 (2.1¢ per megabyte) not covered

TABLE 2: Previous levies




Audio cassettes over 90 minutes in length

29¢ $1.00 23.3¢
Audio cassettes over 60 minutes in length and up to and including 90 minutes in length 29¢ 75¢ 23.3¢
Audio cassettes from 40 minutes up to and including 60 minutes in length 29¢ 50¢ 23.3¢
Audio cassettes 40 minutes long or less 0 - see note ??? - see note 0 - see note
CD-R Audio, CD-RW Audio and MiniDisc 77¢ $1.75 60.8¢
CD-Rs and CD-RWs 21¢ 50¢ 5.2¢
Microcassettes (commonly used in dictating machines) 0 - see note ??? - see note 0 - see note
Digital audio tapes (DATs) 0 - see note ??? - see note 0 - see note


The items marked with "???" were not specifically mentioned in the application for levies. The items above with 0 levy are excluded because the Copyright Board says "Audio recording media that are clearly meant for purposes other than private copying are excluded. A case in point are microcassettes commonly used in dictating machines. Digital audio tapes are another, as for all practical purposes, they are used by professionals, not by individual consumers."

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What happened to the massive levies proposed for MP3 players?

For 2003-2004, the CPCC initially proposed very high levies ($21 per gigabyte) for devices like the Apple iPod or the Creative Nomad Jukebox. These proposed rates were published in the Canada Gazette on Saturday, March 9, 2002. A PDF of the Canada Gazette notice is available on the Copyright Board website and is called the Private Copying Tariff, 2003-2004.

For example, the Apple iPod has a 40 gigabyte hard drive and sells for $754 CDN. The proposed levy on it would have been $840.

In a later filing to the Copyright Board, the CPCC modified many of their proposed rates, introduced a complex sliding scale for the rates applied to MP3 players. On the revised scale, the levy on a 40 gigabtye iPod would have been about $150, still a substantial amount. (Click here to see a table of the revised levies.) (Link and table added 2003-12-16)

In its December 12, 2003 ruling, the Copyright Board set the levy rates for "non-removable memory permanently embedded in a digital audio recorder, $2 for each recorder that can record no more than 1 Gigabyte (Gb) of data, $15 for each recorder that can record more than 1 Gb and no more than 10 Gbs of data, and $25 for each recorder that can record more than 10 Gbs of data." Thus the levy on a 40 gigabtye iPod is now $25.

Note that US Title 17, section 1004, (see states: "Notwithstanding paragraph (1) or (2), the amount of the royalty payment for each digital audio recording device shall not be less than $1 nor more than the royalty maximum. The royalty maximum shall be $8 per device, ..."

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Who sets the levy and who can change it?

A simplified version of the process is as follows:

The statement of levies the CPCC proposes to collect for the years 2003 and 2004 was published in the Canada Gazette on Saturday, March 9, 2002. A PDF of the Canada Gazette notice is available on the Copyright Board website and is called the Private Copying Tariff, 2003-2004

The levy is set by the Copyright Board for a term of 1 or 2 years. The first levy period covered 1999-2000. The current levy is in effect for 2003-2004. In theory, the levy could change on January 1, 2005, but the Copyright Board has to hold hearings and issue a ruling first. Historically, the rulings have been issued in mid-December, although for the 2003-2004 period, the final ruling was issued December 12, 2003, more than a year after the hearings.

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When will the next hearings be held?

Hearings to consider the levies the CPCC proposes to collect for the years 2005-2006 will probably be held in the fall of 2004. Here is a typical calendar of events based on previous years:

Note: There is a big difference between a formal written objection and written comments. See the next item for details.

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Can I object to the proposed levies?

You can do one of two things: file a formal written objection or submit written comments.

Formal written objections require a considerable amount of work and must follow a procedure outlined by the Copyright Board. You cannot file objections until the notice of proposed tariffs is published in the Canadian Gazette.

Written comments are just that - preferably an email which becomes part of the record of the hearing and will be considered by the Board in their ruling. The last day to file written comments is the day before "final arguments" begin (at the end of the hearings).

Note that the ONLY practical things you can object to are the proposed value of the levy or the media to which the levy applies. For example, the Board has ruled in the past that "Audio recording media that are clearly meant for purposes other than private copying are excluded."

The Copyright Board is bound by law to set a levy, they CANNOT change the legislation. This means it is pointless to:

Contacting the Copyright Board

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How can I avoid the levy?

First of all, make sure you don't get ripped off by confused or shady retailers collecting "the tax" at the cash register.

If you buy any blank recording media outside Canada and use it yourself they will not be subject to the levy. Why? Because YOU are the importer and you are not selling blank media. It is the sale of blank media by the importer or manufacturer that triggers the levy.

No levy is payable on any blank recording media that "is destined for export".

If you are a manufacturer or importer, you can avoid the levy entirely on your products as long as you record some sound on the media before you sell it. The sound recorded on the media can even be erased. Clearly this is not an option for CD-Rs, but for devices that include a hard drive, simply recording a sound on the drive and then erasing it exempts the drive from the levy. This is because (as the legislation now stands) "blank audio recording medium means a recording medium, regardless of its material form, onto which a sound recording may be reproduced, that is of a kind ordinarily used by individual consumers for that purpose and on which no sounds have ever been fixed..."

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Is anyone exempt from the levy?

By law, no levy is payable on sales to a society, association or corporation that represents persons with a perceptual disability. There are no other exceptions. Note that a blind or deaf person purchasing CD-Rs in a retail store would be paying the levy because it is embedded in the price of the product.

Under certain terms and conditions (known as the zero-rating program), the CPCC used to waive the levy on sales of some media to certain persons or organizations. These included

In its news release announcing the December 12, 2003 decision, the Copyright Board said:

However, objectors raised a number of concerns with the existing or planned extended CPCC's zero-rating program, claiming, among other things, that the program is inherently unauthorized, illegal and unfair. The Board concluded that just as it does not have the legal authority to create levy exemptions under the Copyright Act, nor does the CPCC. As a consequence, the Board concluded that CPCC's existing or proposed expanded zero-rating program is illegal.

This means that the only groups exempt from the levy are societies, associations or corporations that represent persons with a perceptual disability.

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How can I avoid getting ripped off?

Remember that the levy is applied ONLY when a manufacturer or importer sells the blank audio recording media.

Some retailers mistakenly believe that they need to raise their prices to collect the levy. However, the levy is not applied at the retail level, it is applied to importers and manufacturers. None of this "just-in-case" retail price rise will be owed to or passed on to the intended beneficiaries of the levy (recording artists, etc.). The retailers will pocket it all. (Note that a special case exists where the retailer is directly importing the media, because they are both the importer and the retailer.)

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How do the CPCC justify their proposed levies?

The CPCC website used to contain a "fact sheet" that described their methodology for deriving proposed levy rates. Because the content on the CPCC website is quite dynamic, links to the site are frequently broken. Here is a quick summary of their position as described in the fact sheet:

Please note that since the fact sheet is no longer available, the process described above may no longer apply.

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How much money does the CPCC collect and how is it distributed?

This information can be found on the CPCC Financial Highlights page and on the CPCC News page in the PDF titled "18 June 2003 - Submission of the Canadian Private Copying Collective: Section 92 Review".

How the money is distributed is determined by the Copyright Board, which ruled for 2003-2004 that it should be distributed as follows:

Where (roughly speaking) an author is a songwriter, a performer is a musician or singer, and a "maker" is a record production company.

Performers and makers only qualify for payment if they are Canadian. However, authors qualify regardless of their nationality.

Note that the Copyright Board does not indicate which author, performer or maker should be compensated, but simply how the funds should be apportioned amongst the three groups. The CPCC determines the amount to be distributed to each individual based on sales information (50%) and based on radio airplay (50%). This can be a complex calculation since there may be several authors and performers involved in any particular recording.

The amounts of money collected and distributed by the CPCC are shown below.

Revenue and expense summary for the CPCC as of September 15, 2003:

2000 2001 2002
Revenue $7,245,000 $24,258,000 $27,809,000
Expenses $414,000 $1,073,000 $1,533,000
Expense as % of revenue 5.72% 4.42% 5.51%
Deficit at start of year ($1,934.000) 0 0
Available for distribution $4,897,000 $23,185,000 $26,276,000

As of December 12, 2003 the CPCC anticipates that it will have distributed the bulk of the $28 million collected in 2000 and 2001 by the end of 2003 and it will have made a good start on distributing the $26 million available for distribution from the levy in 2002.

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What are blank audio CDs or CD-R Audio?

There are special CD-Rs called "blank audio CDs" made for use in home recording units that allow the users to copy audio CDs. These are referred to as "CD-R Audio" by the Copyright Board. They attract a levy of 77¢ each.

These CD-Rs include a specially embossed section on the disk that is read by "consumer" CD recorders. You cannot use regular CD-Rs in these recorders. These CD-Rs work with with the Serial Copy Management System (SCMS) which prevents the CD from being duplicated. (That is, it will not copy a copy.)

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Who is Neil Herber?

Neil Herber works for Eton Systems, a technical publishing company that creates, writes, edits, and publishes reference and marketing material for clients in the high-tech, scientific, and engineering communities. More details are available on the Eton Systems corporate website.

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IMPORTANT NOTE FROM NEIL HERBER: I am not a lawyer, but I have discussed most of the points I make here with a lawyer. You should not rely on any of this material for making business decisions of any type. Consult with your legal advisor.

Material from other websites is provided for informational purposes only. The other websites all have their own disclaimers. The links to commercial sites are simply to provide examples of the equipment or media being discussed. I am not remunerated by anyone in any way for producing this page.

I have tried to ensure that all of the material presented on this page is accurate and factual. Where possible, I provide links to original source documents, so you can confirm my interpretation. If you detect an error, please let me know so that I can correct it.

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Please submit any comments or new questions using this form I answer every email or form submission I receive, as long as you provide a valid return address.

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