Chancellor Rishi Sunak is being urged to abandon a substantial VAT hike on concert and live event tickets that is due to kick in on April 1.
The warning comes ahead of the Chancellor’s Spring Statement on March 23, when he will outline a mini-budget.
UK Music chief executive Jamie Njoku-Goodwin has written to the Chancellor to highlight the “hugely damaging” impact that a planned Treasury hike in the VAT rate on gig tickets could have on millions of music fans and the music industry.
At present, VAT is charged at 12.5% on tickets for live events. However, the Chancellor is planning to hike the VAT rate to 20% on April 1 in a move that promoters and music industry chiefs are concerned could force a rise in ticket prices.
Music industry leaders are now calling on the Chancellor to abandon the VAT rise to give the UK music industry and millions of music fans across the country a break just as live music returns after an absence of almost two years due to the Covid-19 pandemic.
The call on the Chancellor to ditch the VAT hike is part of a six-point plan for the music industry outlined in UK Music chief executive Njoku-Goodwin’s letter to Rishi Sunak.
Other measures include extending the current 50% discount on business rates on music venues, and more funding to help British performers touring the EU to navigate extra costs and post-Brexit red tape.
UK Music is calling for a Music Export Office to help boost sales of British music abroad, which dropped 23% from £2.9 billion in 2019 to £2.3 billion in 2020 due to Covid-19.
The collective voice of the music industry also wants music to benefit from the same type of tax breaks as UK film, TV and video firms enjoy, to help attract inward investment and nurture new talent.
UK Music is also seeking more help for the self-employed, who make up more than two-thirds of the UK music industry.
“The planned hike in VAT could not come at a worse time for millions of music fans and the live music industry, which was shut down for almost two years due to the pandemic,” said Njoku-Goodwin.
“We saw during those grim periods of lockdown just how important music was to people’s mental health and how it helped us get through some really tough times.