Association heads from across the live music industry have expressed frustration at the lack of support for the events industry in the Chancellor of the Exchequer Rishi Sunak’s Spring Statement.
Association of Independent Festivals (AIF) CEO Paul Reed said its members were disappointed the Chancellor had failed to respond to the organisation’s repeated calls to grant an extension to the 12.5% VAT rate on festival tickets beyond the end of March.
He said, “Festival organisers are experiencing cost increases of between 20-30%, which is way beyond rapidly rising inflation, with extreme pressure along the entire supply chain. We urge the Government to look at this again and maintain the reduced rate on VAT.”
LIVE (Live Music Industry Venues and Entertainment) CEO Greg Parmley welcomed the Business Rates discount, which will maintain the 50% Business Rates for grassroots music venues that the Government announced pre-pandemic but he said futher measures were needed to support all areas of the sector: “Live music is facing new and unprecedented challenges that threaten to wreck one of the UK’s cultural crown jewels – a 7.5% increase in VAT on tickets, wholesale cost increases and major ticket cancellations due to spiking covid cases. At the same time, the last remaining help from Government is being withdrawn.”
Parmley said the federation of 13 industry organisations, which includes AIF, the Association of Festival Organisers, the Production Services Association and National Arenas Association, is calling for the Government to work with the industry to consider a cultural VAT rate of 5% on ticket sales. It is also calling for a restructure of the Government’s reinsurance scheme to allow for artist cancellation due to Covid-19 to be covered.
Reed said the AIF is also asking the Government to urgently reconsider the removal of tax incentives to use certain biofuels: “These should be maintained at the current rate as a transitional measure to encourage use of greener fuels at festivals. To do otherwise is completely contrary to the Government’s objectives of incentivising energy efficiency and reducing emissions.”
Mark Davyd, CEO of grassroots venue support body Music Venue Trust said Sunak’s budget had failed to respond to inflationary increases from rent, supplies, and services running in excess of 20% across the sector: “The Government has recommitted itself to supporting business investment, especially research and development. We again ask that the Secretary of State for Culture should enter into meaningful discussions with the live music industry to create R&D tax incentives and direct financial support to achieve that outcome.”
UK Music CEO Jamie Njoku-Goodwin said that while the extension of business rates relief will benefit many music venues, the Spring Statement missed the opportunity to help the UK music industry at crucial point in its fightback from the impact of Covid-19.
“We would like to see the Government pave the way for the music industry to enjoy the same kind of fiscal incentives enjoyed by the film, television and animation industries. This would encourage investment and help us nurture the talent pipeline for our world-leading music industry.
“The Government must also look at more support for the self-employed who were among the hardest hit by the pandemic, particularly in the must industry where two-thirds of the workforce are self-employed.”