It is possible to create a eraseable paper tape. Its just not extremely durable.
Two tapes glued togther with internal pockets that contain paper shutters. The shutters can be slid left and right, so that the shutter can cover a hole. Its bulky - I can't imagine making it smaller then 1 cm of tape length per bit without usuing very special equipment. It also is vulnerable to data corruption, as the shutters are only locked in poistion by friction. Of course, if the tape is kept reeled, then the pressure of the tight roll will keep the shutters from shifting.
Diagram to follow.

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