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Chancellor Kwasi Kwarteng has announced a series of financial measures aimed at addressing soaring inflation and the UK’s looming recession, but representatives of the live entertainment industry said they are not enough to help the sector.

The budget measures include a cut in the basic rate of income tax to 19% from April 2023, a cut in stamp duty and the 45% higher rate of income tax being abolished. The rise in corporation tax from 19% to 25% has been cancelled, as will the 1.25% rise in National Insurance. Kwarteng also said the IR35 reforms will be scrapped from April 6, 2023, meaning off-payroll workers will be responsible for determining their employment status and paying the appropriate amount of tax and national insurance contributions.

LIVE CEO Jon Collins said the budget did little to help the live music industry, which contributes £4.5 billion per year to the UK economy. LIVE is a federation of 14 live music industry associations representing 3,150 businesses.

Collins said, “While we are pleased to see the Government taking steps to alleviate the cost-of-living crisis, today’s announcement delivers little for the UK’s world leading live music industry.

“Jobs are already on a knife edge, and we agree with the chancellor that there are too many barriers in sectors like ours where the UK leads the world. Combined with the impact of reduced public spending power and rising costs across the supply chain, businesses that are already struggling to turn a profit will face bankruptcy and closure.

“Only the emergency measures that we have suggested to Government will prevent this – injecting cash into the bottom line of struggling businesses through a reduction in VAT on ticket sales, as well as major reform of Business Rates.”

AIF CEO Paul Reed said, “Today’s announcement from the chancellor means very little for our £1.76bn UK festival industry. We’ve faced unprecedented challenges on increased costs, supply chain and low consumer confidence, with audiences facing a social emergency. This shows no sign of relenting as we look to 2023. What we need is an urgent reduction of VAT on tickets to 5%, and an assurance that festival businesses will be classed as vulnerable and eligible for support with the energy crisis beyond March 2023.”

Night Time Industries Association (NTIA) CEO Michael Kill said the chancellor had missed an opportunity to support businesses that have been hit hard during the financial crisis, and called on Kwarteng to re-evaluate the inclusion of general business rates relief and the reduction of VAT within the measures.

Said Kill, “We have been extremely clear with the Government that the Energy Bill Relief Scheme, even with the announcement of the limited tax cuts on National Insurance, Corporation Tax and Duty, is unlikely to be enough to ensure  businesses have the financial headroom to survive the winter, especially with yesterday’s announcement of the rise in interest rates from the Bank of England.”

 

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