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UK government’s spending plans a mixed bag for the music and night-time sectors

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By Chris Cooke | Published on Thursday 28 October 2021

The UK music industry has welcomed elements of the budget statement made yesterday by Rishi Sunak – the maths man among Britain’s government of med…

Business News Legal Live Business Top Stories

By | Published on Thursday 28 October 2021

UK Parliament

The UK music industry has welcomed elements of the budget statement made yesterday by Rishi Sunak - the maths man among Britain's government of mediocre minds - although some of the key support measures proposed by music and other night-time businesses were not included. And pretty much everyone in the music community can probably think of a better way to spend GBP2 million of tax payers' money than building yet another Beatles attraction in Liverpool. Among the things in Sunak's big statement that were welcomed by the music industry were a new business rates discount scheme that will benefit the retail, hospitality and leisure sectors, which includes music venues.

Clubs, bars and music venues will also benefit from changes in, and a simplification of, alcohol duties. Sunak also announced plans to invest "GBP850 million to protect museums, galleries, libraries and local culture", and an extension of tax relief schemes that benefit certain cultural and heritage institutions, including orchestras. However, as the music, live entertainment and night-time sectors begin their recovery after all the COVID-caused shutdowns, organisations representing those industries had other requests of government, in particular an extension of the current temporary VAT discount on tickets, and new tax relief schemes for the wider music sector.

Commenting on Sunak's statement yesterday, Paul Reed of the Association Of Independent Festivals welcomed the support measures that were announced, but added: "It doesn't go far enough in supporting our truly world-leading festival industry". "It is clear", he went on, "that the most effective way for the government to support the industry's recovery into 2022 and beyond would be to extend the VAT reduction on tickets, look closely at a permanent cultural VAT rate, and completely remove festivals based on agricultural land from the business rates system. Unfortunately, none of this was forthcoming today".

Michael Kill from the Night Time Industries Association likewise welcomed the positives in the budget statement, observing that "the announcements on business rates relief for hospitality, the simplification of alcohol duties, and the cut in duty for draught beverages will be welcomed by thousands of businesses in the night time economy". However, he said, "we were disappointed that [Sunak] chose not to extend the 12.5% rate of VAT on hospitality - this is a missed opportunity". Paul Pacifico of the Association Of Independent Music also welcomed the discount in business rates, as well as the increased tax relief for orchestras, but added: "More must be done to support the globally significant independent music sector to ensure a viable future for diverse music, creators and entrepreneurs".

He then honed in on the proposal for a wider tax relief scheme for music, "like those successfully implemented in other creative industries such as film and games. This cost-effective measure could provide our sector with the boost it needs, attracting inward investment and creating a ripple effect across the wider music ecosystem. We urge government to include music in such schemes at the next opportunity".

That call was echoed by UK Music, which last week published a Music Industry Strategic Recovery Plan that made various demands of government. "We are pleased to see the extension of the orchestras tax relief", UK Music boss Jamie Njoku-Goodwin said yesterday. "Yet the government has missed an opportunity to not take forward further music tax incentives to help boost jobs and economic growth". Njoku-Goodwin also noted the failure to extend the VAT relief for the live side of the business, adding "business rate relief for venues is very welcome yet we remain concerned about next April's VAT hike for live events".

Expanding on some of the other measures the music industry is seeking from government, he went on: "Ministers must put turbo-chargers under the efforts to clear away the barriers that are still making it so hard and expensive for musicians and crew to tour easily in the EU. As the domestic music market recovers, the government should also build on recent trade deals by giving more funding and support for music exports". "As well as music's huge economic and cultural importance", he added, "we also need to see the government fully recognise its huge value to our wellbeing by properly funding music education to help nurture our talent pipeline and provide the stars of the future".

Greg Parmley, CEO of live industry organisation LIVE, also outlined the wider support measures the music community needs as it tackles the ongoing challenges caused by both COVID and Brexit. "We're glad to see that live music will receive some benefit from today's spending review - including tax relief, business rates, and some extension in terms of funding", he said. "However", he added, "with the word 'music' completely absent from today's announcement, we remain steadfast in our drive to see government pay attention to the key issues we are facing: the impacts of Brexit, the recovery from COVID and the long-term growth of the sector.

We need government to give us the tools to make progress, which were unfortunately missing from today's news". As for the funding to help facilitate a new Beatles attraction in Liverpool, Sunak stated yesterday that Culture Secretary Nadine Dorries "has secured up to GBP2 million to start work on a new Beatles attraction on the Liverpool waterfront". Because that's what the Merseyside music community clearly needs right now, another damn Beatles attraction.

Good times!



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