Bought a phone 6 months ago no taxes up front, three weeks ago taxes up front. So I'd say its become a thing somewhere within the past five months having no clue why. There are subtle hints on their webpage taxes are due up front yet they also say one can buy a device for "$0 upfront". Obviously not the latter no matter how one spins it. Also checked Rogers and Bell unable to verify if they are doing the same, at present doesn't appear they are.
Something similar happens with service rebates. The difference is whether you are given a discount, or a rebate. Tax law sees the two as being different. If the sale price is reduced to zero, then you pay no tax. If you get a rebate, say for signing a 2 year contract, that is calculated after the tax is applied. It is confusing, as we see both being the same, but they are different in the eyes of the tax man.
If it helps, think of it like a mail in rebate you can apply at the cash register.
I'm curious as to how the taxes are calculated. A portion of your monthly bill can be attributed to paying for your discounted device. I'm sure that amount is already taxed. If you are being taxed up front for the device discount isn't that applying double tax on the same amounts?
Perhaps the "upfront" part of it is shifting the monthly tax and paying it in advance rather than taxing it twice. I would hope that's what is happening. I never buy my phones on a contract so I've never seen it on my bills.