Christopher BarrettMusic business representative body UK Music has called on Chancellor Jeremy Hunt to dramatically reduce the VAT rate on ticket sales in the forthcoming Budget to throw a “vital lifeline” to the live music sector and help save closure-threatened venues.
It is the latest call for urgent help from the live music industry, with the Association of Independent Festivals (AIF) and the Night Time Industries Association (NTIA) having both lobbied for an urgent reduction in VAT on tickets.
UK Music interim CEO Tom Kiehl called on the Chancellor to use his budget on March 6 to cut the current 20% VAT rate on tickets to 10% in a boost for consumers, music professionals and venues.
The call to cut VAT is among the recommendations that UK Music has made to the Government in its Budget submission, which outlines the support the sector needs to grow.
The 20% UK VAT rate on tickets is the third highest rate of cultural ticketing in Europe, almost double the EU average of 10.3%, and around triple the rate in countries like Belgium (6%) and Germany (7%).
The calls come amid mounting fears for the future of some music venues and festivals, which are facing an unprecedented cash squeeze due to soaring energy bills, the cost-of-living crisis and rising labour costs.
Around 125 grassroots music venues were lost in 2023, according to the Music Venue Trust, while the AIF has announced that following 36 UK festival closures last year, at least a dozen have been called off already in 2024.
Kiehl said, “We urgently need to see some action from the Chancellor in the Budget to support the UK music industry at what is an immensely tough time for many venues and for those working in our sector.
“Cutting VAT on tickets to 10% would be a vital lifeline and could mean the difference between saving and losing some of our most loved music venues, which are key parts of many local economies and communities.
“Reducing the tax burden will help boost investment at grassroots level and give local venues and economies across the UK a much needed shot in the arm.
“Venues are part of a wide music ecosystem, which needs support in a number of important areas to help the sector grow and thrive.”
Kiehl said the Government should extend its support for music export schemes and tackle the barriers still facing musicians and crew touring parts of the EU. He also said the industry needs the Chancellor to further extend Orchestra Tax Relief at its current level to help safeguard the future of orchestras.
“The UK has a world-leading music sector. However, it needs action from the Government to ensure it can continue to grow for decades to come,” he said.
According to UK Music research, an estimated 14.4 million “music tourists” travelled to enjoy live music at venues across the UK in 2022, and those gig-goers spent a total of £6.6 billion in 2022.
UK Music’s figures show that music contributed £6.7 billion to the UK economy in 2022 and employed 210,000 people.