UK Music has broadly welcomed the Chancellor’s Budget, but called for reassurances on areas affecting the industry including business rates, licensing and support for music in schools.
One of the most eye-catching proposals will make tech giants pay a 2% levy on sales they generate in the UK. Amazon, Google, Apple and Facebook have faced criticism for the levels of tax they pay on UK profits.
The digital services tax would be introduced from April 2020, following a consultation.
“It is absolutely right that tech giants should pay more tax to the UK,” said UK Music CEO Michael Dugher. “We look forward to working with the Government in the development of this to ensure it is carefully designed and does not turn into an online sales tax.”
Deborah Annetts, chief executive of the Incorporated Society of Musicians, said: “We hope that the tech tax of 2% will be used by the government to invest in the creative industries including music at this critical time as music faces serious challenges in a post-Brexit world. Never has there been a more important time to invest in both the music industry and music education – the key driver of the talent pipeline for one of our most important industries.”
In his Budget, Philip Hammond also announced measures including a £400 million in-year bonus for schools to pay for new equipment.
“The Government’s Budget is potentially good news for the music industry, but important reassurances are needed in a number of areas to support our talent pipeline that is the key to music’s £4.4 billion contribution to the British economy,” said Dugher.
“UK Music called for a review of music funding in state schools to halt the spiral of decline that is the current worrying situation in state education. The Chancellor’s decision to provide schools with new funds could offer much needed short term relief, providing that this can be invested in new music facilities and instruments. But ensuring that children from all backgrounds have access to music, including instruments, is not about providing ‘little extras’. Music should be a right and an opportunity for children to experience everywhere.”
Annetts added: “We welcome the Government’s decision to invest a much-needed extra £400m in our schools. It is vital that our children have access to the very best education within both primary and secondary settings so that they can make the most of all of their talents.”
The Budget also had plans to implement a third off business rates for retailers over two years, if the rateable value is under £51,000.
“The cut in business rates for small retailers is welcome,” said Dugher. “The Government must ensure that music venues and studios, who have in recent years faced huge hikes in business rates, stand to benefit from this.”
Other Budget announcements include plans to boost apprenticeships at small firms
“We welcome the proposals to incentivise small firms to take on more apprentices,” said Dugher. “The music industry is an important provider of jobs and we remain committed to providing more good quality apprenticeships.”
He added: “Plans announced to liberalise the planning system in order to turn commercial properties into residential accommodation must also be carried out with full regard to the ‘Agent of Change’ principle to protect music venues. This must not be an opportunity for developers seeking more residential building to ride roughshod over struggling, pre-existing music businesses. We need measures that make things easier, not harder, to nurture and grow the nighttime economy.”