iPod Tax in the Netherlands
The Register is reporting MP3 players in the Netherlands will be taxed as much as €3.28 ($4.25) per gigabyte to subsidize large music companies. This means that a 60 GB iPod could incur a €196.80 ($253) tax. Considering that the 60 GB iPod costs about €350 ($449) in the first place, it's obvious that MP3 player sales will crash in the Netherlands if this tax becomes law there.
What I find most interesting about this is the fact that if you legitimately buy music on iTunes for your iPod, you will end up paying twice for your music. Grating record companies a tax on devices that could possibly be used for music piracy either sounds like favoritism or license to let piracy flourish.
The law taxes any device that could be used to store illegally gotten music, so to me that includes hard drives in computers. Considering that the cost per gigabyte of a desktop computer's hard drive is usually less than €.75 ($1.00) per GB. This would push the price of a hard drive well over 4 times what it is currently. If this tax were enforced on computers as well, you will see the computer industry migrate out of the country as well.
I can't imagine that this will actually happen. Any economist will tell you that when you place an artificial barrier such as a tax in the way of a market, the market will fairly quickly find a way around it. It's similar to trying to block a river. At some point, the water will find a way around the block, so it will be interesting to see how this turns out.
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