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Re: [d@DCC] Fwd: Say no to an Internet tax

From: Russell McOrmond <russell _-at-_>
To: "General Copyright Discussions (questions, organizing, etc)" <discuss (at)>
Date: Wed, 19 Oct 2016 09:32:29 -0400
References: <> <>

On Wed, Oct 19, 2016 at 12:41 AM, krishna e bera <> wrote:

> I think i'm willing to pay an ISP bandwidth tax similar to the blank
> media tax, but *only if* it makes me immune to copyright infringement
> (aka sharing) lawsuits and prosecutions. (Legal enforcement of DRM
> should be removed regardless.)  Obviously, not all bandwidth is
> copyright infringement just as not all blank media are used for that,
> but some oft-quoted figures said bittorrent is ~40% of internet usage.

Tax policy can never be explained in a soundbite.  I'll toss some points on
why an internet tax to subsidise copyright holders is bad economic policy,
but suspect I'll have to create a longer form one later.

The comparison with the blank media levy is appropriate, as it is bad
economic policy for the same reason.  As in that case it is being proposed
by creators who are the part of the economy that will be hardest hit by
this harmful economic policy: yes, I'm saying the people asking for this
policy will be greatly harmed by it, and this is a large part of why I
oppose the policy.

Tax policy has a number of purposes:

 * To gain revenue for the government to carry out the workings of
government and pay for government services.
 * Through tax reductions, tax expenditures (exemptions, deductions,
credits) and other subsidies (grants, etc) encourage behaviour that is seen
as beneficial to society.
 * Through tax increases, and reductions of subsidies (tax expenditures,
grants, etc) discourage behaviour that is seen as harmful to society.

For Canadian creativity the policy should be focused on the dual (some
claim duel, but I disagree) purpose of copyright law, which I believe is
articulated well in article 27 of the UN UDHR

Article 27.

(1) Everyone has the right freely to participate in the cultural life of
the community, to enjoy the arts and to share in scientific advancement and
its benefits.
(2) Everyone has the right to the protection of the moral and material
interests resulting from any scientific, literary or artistic production of
which he is the author.

That is, participation in culture which includes access to the creativity
of others to enjoy and build upon, and for creators to receive moral and
material (ie: money) rewards.

  Media/distribution taxes harm all aspects of this policy:

 * It does not provide incentives to distributors to make content more
easily available to audiences.  This is why I believe that services such as
Netflix should be encouraged through tax policy while mechanism to restrict
access such as encrypted media or exclusive licensing should be discouraged
through tax policy.  (Netflix should be subsidised not taxed, and encrypted
media should be taxed not subsidised)

 * It does not reward the authors whose works are being enjoyed, and is
subject to abusive statistics which most often subsidise the wrong entities
on the backs of those whose works are actually being enjoyed and built upon.

 * It encourages less accurately surveyed access methods which reduces the
validity of the statistics used for distribution.  With a tax in place
fewer people will subscribe to Netflix and instead use things like the
Exodus plug-in for Kodi on set-top boxes.  This is true regardless of
whether it is accompanied by a change to copyright law: if people feel they
are already paying to access unauthorised sources then more will do so
because the moral aspect is gone, regardless of any change in the legality.

  One of the advantages of a move away from legacy broadcast to streaming
(and equivalents for other types of creativity) is that distributors have
accurate statistics as to what is being accessed.  This will further
encourage more creativity that audiences want, which should be a goal of
cultural and tax policy. Again, a blanket tax on the Internet and media
runs counter to these goals.

  I will put more thought into a future article, but you get the idea.
This policy will reduce revenue to creators and discourage the creation of
more works that audiences want.

  I find it amusing that you used a 40% BitTorrent statistic, which is an
example of the bogus statistics I'm speaking of.

  * BitTorrent is a distribution mechanism, and like blank CDs has a
percentage that is authorised and a percentage unauthorised.  You posted it
as if all was unauthorised, like the claim that some labels made that all
blank CD usage was infringing -- ignoring the fact that software and other
things (including music) where legally distributed that way.

 * Your statistic is widely outdated, and changed in ways that are quite
informative.  It turns out that lawful streaming services like Netflix
displace unauthorised use of BitTorrent for media distribution.  The more
easily content that is available from lawful services, the less
infringement.  I didn't see the number but I can guarantee that there was a
jump in unauthorised streaming when Netflix started blocking VPN's for
Canadians.  Region restrictions provide incentives for infringement, and
thus should be discouraged in government policy.
    If copyright infringement is something we as a society think is bad
(And all governments claim they believe this) then we should be using tax
policy to discourage rather than encourage it.  An Internet tax would
encourage harmful behaviour (whether legal or not), while we should be
implementing policies such as subsidies and other favourable policies (such
as mandating that North America be a single region for any regional
restrictions, such that any Netflix content available to US citizens are
equally available to Canadians) to services which replace infringement.
Policies which encourage infringement (IE: exclusive "broadcast" windows
where content is available on broadcast/BDUs but not streaming) should be
discouraged (taxed and/or reductions in deductions/subsidies).

Feel free to tell me what is wrong with the above trade-off...

  I believe your conclusion was wrong because you only thought of it as a
short-term trade-off for audiences.

  You didn't put any longer-term analysis into the cultural and economic
impacts such as considering the massive harmful impact it would have to
Canadian creative sectors and thus the reduction of the quality/quantity of
new works available to audiences.

Russell McOrmond, Internet Consultant: <>

Please help us tell the Canadian Parliament to protect our property rights
as owners of Information Technology. Sign the petition!

"The government, lobbied by legacy copyright holders and hardware
manufacturers, can pry my camcorder, computer, home theatre, or portable
media player from my cold dead hands!"
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