The Copyright Board of Canada has given the go ahead for a tax to be placed on iPods and removable memory storage cards for private copying.

The tax was opposed by both the Canadian Storage Media Alliance and the Retail Council of Canada, who claimed that previous court decisions had already struck down any kind of fine. The board disagreed.

Kim Furlong, Director of Federal Government Relations with the Retail Council told BetaNews that this is a dangerous approach.

"It's like going into Best Buy and learning the computer is a hundred dollars more just because the government thinks you might download music. It's effectively a hidden tax," she argued.

"We're disappointed with the ruling," Furlong said. "We feel that the board has no jurisdiction here and that the Federal Courts have already struck down the levy. We're looking into legal avenues to fight it right now."

Levies could even be applied to P2P systems, which some argue could answer the problem of file sharing. Other countries have proposed similar fee-based structures, but such ideas are strongly opposed by the recording industry.

The decision will likely be appealed, although it is said that if the ruling stands, it would not mean immediate taxes on iPods. Instead, it is probable that new hearings on the subject would occur.

"They assume with the levy that everybody downloads illegally," Furlong said.

University of Ottawa professor Dr. Michael Geist added that the Canadian government must assert a position soon. "The government has yet to play its hand on this issue, but with the prospect of an unpopular levy and mounting pressure for a Canadian fair use provision, it will have to take a stand sometime soon," he said.