The music industry has responded to the latest budget statement from the UK government, which was delivered by Chancellor Of The Exchequer Jeremy Hunt yesterday.
There was one positive in the budget, the extension of orchestra tax relief. However, the big ask from the live sector - a cut in the VAT charged on tickets - was ignored, meaning the industry’s response has mainly been negative. There also remain calls from some parts of the industry for other tax relief schemes to benefit the wider music community.
Here are the responses issued by various music industry organisations…
Tom Kiehl, Interim CEO of UK Music: “I welcome that the Chancellor has listened to industry calls to put in place extensions to the orchestra tax relief on a permanent basis.
The government should use this opportunity to clarify our further calls as to whether touring choirs and other singing groups are also eligible for this important relief.
We welcome the indirect benefit to music of the introduction of other creative sector tax reliefs and seek further government consideration for the introduction of a tax credit to encourage new UK music production.
Introduced in 2016, orchestra tax relief is aimed at supporting live orchestral performances. The headline rate was uplifted to 50% in 2021 in the wake of COVID and was extended in 2023 for a further two years until April 2025.
The Musicians’ Union and the Association Of British Orchestras were among the many groups that had called on the Chancellor to make the relief permanent”.
Jon Collins, CEO of LIVE: “LIVE welcomes the Chancellor's announcement that the tax reliefs for orchestras and theatres will be made permanent.
However, today's budget represents yet another missed opportunity to accelerate the growth of the live music sector and the wider economy while also providing urgently needed support for grassroots music through the reintroduction of a lower VAT rate.
20% VAT on tickets in the UK is vastly out of step with our competitors in Europe and North America and has become a material factor limiting the number of gigs, tours and festivals our world class industry can put on.
Fewer shows mean reduced economic activity in towns and cities across the country - an estimated £1 million is spent in local businesses for every 10,000 people who attend a gig - and heaps further pressure onto grassroots music venues that are closing down at an alarming rate. We need urgent action to ensure the whole sector can prosper in the long term”.
John Rostron, CEO of the Association Of Independent Festivals: "We're disappointed that our calls for support for the UK music festival sector have not been met.
Festivals need a temporary reduction in VAT on ticket sales from 20% to 5% in order to recover from the impact of COVID and Brexit, which has created a credit crunch that is seeing successful festivals having to postpone or cancel this year months before their events are due to take place.
Yet another festival fell yesterday - the fifteenth event to fall already in 2024. Theatre has made the case for tax relief, which is being extended indefinitely. We urge the Chancellor and the Treasury to now turn to festivals and offer a fraction of that support to ensure more events do not make 2024 their last”.
Naomi Pohl, General Secretary of the Musicians’ Union: “A permanent increase in the rate of tax relief for orchestras and theatres is extremely welcome.
We are grateful that the Treasury has responded to requests for this from the MU, Equity and BECTU and trade bodies in both sectors. The increase will give greater certainty for organisations at a time when funding is precarious and the costs of touring have sky-rocketed.
For the Musicians' Union, we hope this will lead to greater opportunities, more secure work and ultimately better pay for our members. Musicians in theatre and the orchestral world are struggling and they need some relief from the constant threat posed by diminishing resources”.
Deborah Annetts, CEO of the Independent Society Of Musicians: “We welcome the Chancellor’s decision to permanently increase orchestra tax relief and theatre tax relief.
This decision will bring enormous benefits to musicians, the music sector and the wider creative sector. We are delighted the Chancellor has listened to sector representations on this important issue.
Despite this good news, the Chancellor has not extended tax relief to choirs, nor is there targeted support for music venues, or a plan to support the cultural organisations facing cuts from local authorities. There are massive challenges facing our sector that have regrettably gone unaddressed today.
The last Conservative election manifesto promised an Arts Pupil Premium, and with a General Election this year and no announcement today, that promise to schools, teachers and students has been broken”.
Michael Kill, CEO of the Night Time Industries Association: "The economic challenges faced by our sector are catastrophic and, following today's spring budget announcement, the lack of support will have a profound impact on this sector for years to come.
For months, the entire sector has been providing the government with critical information outlining our precarious situation and the urgent need for supportive measures to sustain businesses through these turbulent times.
In simple terms, it's time for change. We have lost faith in the government. The livelihoods and businesses we represent are not political pawns but vital contributors to community well-being across the UK. It is imperative that the government recognises this and takes decisive steps to support the sector”.
Silvia Montello, CEO of Association Of Independent Music: "Music contributes over £6 billion to the UK economy a year. However, further support will be required from the government in order to maintain our position in the global market and continue to develop world-leading artists.
This should include fiscal incentives for the independent businesses that find and invest in the global stars of tomorrow and tax breaks for music along the lines of initiatives supporting the film and TV industries.
These measures would also help to counter the damage done to local music scenes over recent years through the reduction in arts and culture funding across the UK. There is still a vital need for support for artists and concert venues in order to weather the current crisis facing live music.
Finally, we also urge the government to consider the need for stronger copyright standards to ensure creators are fairly remunerated when AI systems are trained on their work, as well as greater help for freelance workers, who make up around 70% of workers in the music business”.
