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APM applauds “common sense” Canaries VAT cut

The cut in value-added tax (VAT) long campaigned for by the Spanish live music industry is finally a reality – but only in the Canary Islands.

Despite the ruling People’s Party promising in September to slash the much-criticised 21% of VAT rate nationwide, the Canaries – which already had a much lower tax of 7% – have beaten it to the punch, reducing VAT to 3% in a move welcomed by the country’s Association of Music Promoters (APM).

APM president Pascual Egea (pictured) tells Vozpópuli the tax cut is “great news” for the live sector. “At last, someone with common sense and who understands the importance of culture,” he comments.

At last, someone with common sense and who understands the importance of culture”

“The increase in VAT to 21% has had a [negative] economic impact on our sector because it also came at the worst moment, in the midst of [the financial] crisis. In the first months our turnover fell by almost 30%, and four years later we have still not recovered“.

The Canary Islands are one of Spain’s 17 autonomous communities, located off the coast of southern Morocco.

 


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New UK promoter Crosstown Concerts launches

Crosstown Concerts, the new promotion venture from former Metropolis Music directors Paul Hutton and Conal Dodds, officially entered the world last night with a launch event at London venue Magic Roundabout.

The first show by Crosstown – a joint-venture limited liability partnership (LLP) between Hutton, Dodds and Oaksmere hotel owner Fraser Duffin – was Massive Attack’s sold-out 30,000-cap. homecoming concert on the Bristol Downs on 3 September, with future shows including Benjamin Francis Leftwich at the Islington Assembly Hall (800-cap.) on Thursday 22 September, Kano and Little Simz at the O2 Academy in Brixton (4,921-cap.) on 7 October and PJ Harvey at Starworks Warehouse (5,000-cap.) in Wolverhampton on 4 November.

“First and foremost we are music fans,” says Hutton, who left Metropolis earlier this year. “We are in this to promote quality concerts and events, and at the core of our business is working with artists from the beginning of their careers.

“The most important people to us are the general public; they pay our salaries by purchasing concert tickets, and for too long they have not been treated with the respect they deserve. One of the key areas we will be tackling is secondary ticketing, which has a huge negative impact on the UK live music scene. We are committed to tackling the problems surrounding the resale of tickets and providing fans with better-than-ever live experiences.”

“The most important people to us are the general public; they pay our salaries by purchasing concert tickets, and for too long they have not been treated with the respect they deserve”

To that end, Songkick will be Crosstown’s exclusive primary ticketing and technology partner for all events.

The new company, based in London and Bristol, also encompasses a record label, Crosstown Recordings, which launches later this month. “Paul and I share a lifelong dream of setting up our own label to bring forth exceptional new talent,” comments Dodds, “and with both Moses and Keir we are thrilled to bring them to everyone’s attention. They are both really exciting new artists.”

“Ultimately our priority is to promote great artists and give people memorable life experiences,” concludes Dodds. “We and Songkick are committed to doing our utmost to prevent the reselling of tickets for profit on secondary ticketing sites. We’re going to be bold and committed in our approach, and are looking forward to creating many unique moments for artists  and their fans.”

 


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Spanish promoters welcome VAT reduction pledge

Acting Spanish prime minister Mariano Rajoy has agreed to a reduction in the hated 21% rate of cultural value-added tax (VAT) should his People’s Party (PP) form Spain’s next government.

PP, which won the most votes in June’s general election – Spain’s third in five years – but failed to secure a majority, last week put its name to a document entitled 150 Commitments to Improve Spain (150 Compromisos para Mejorar España), which included as commitment №89 a pledge to reduce VAT for live entertainment or “cultural shows” (espectáculos culturales).

150 Compromisos is co-signed by the Citizens (C’s) party, with which PP has a parliamentary alliance.

Cultural-sector VAT has stood at a record 21% since September 2012, when Rajoy (pictured) increased the tax, which previously stood at 8%, in an effort to plug a hole in Spain’s public finances. The tax hike has been catastrophic for the Spanish live industry: revenue from ticket sales fell 27.51% between 1 September 2012 and summer 2013 alone, and the country’s live music industry only recently recovered to its pre-2011 levels in February.

Left-wing parties Unidos Podemos and PSOE have previously announced their support for a VAT reduction.

“We welcome this willingness to reconsider VAT at the reduced rate [and] the explicit recognition of live entertainment, including live music”

The Association of Music Promoters (APM) welcomed the publication of the document. “After four years of ordeal – moving from a cultural VAT of 8% to 21%, which has so damaged us – we welcome this willingness to reconsider VAT at the reduced rate,” says APM president Pascual Egea.

“We welcome the explicit recognition of live entertainment, including live music, though we wish this commitment had been extended to our colleagues in cinema – a very important part of the cultural industries in our country. We believe that culture should be a matter of state, and as such must be treated as such by the future government, whatever colour it is.”

Rajoy on Friday again failed in his bid to form a new government, setting the stage for Spain’s second general election of 2016. Should the parties involved fail to end the deadlock in the next two months, King Philip VI will be forced to dissolve the Spanish legislature, the General Courts, and call another election.

 


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Cross-party support for Spanish VAT reduction

A number of Spanish opposition politicians have pledged to more than halve the country’s sky-high cultural value-added tax (VAT) rate should they be in government following Sunday 26 June’s general election.

At an Association of Music Promoters (APM)-hosted panel at PrimaveraPro last week, Eduardo Maura of left-wing alliance Unidos Podemos, Marta Rivera of Citizens (C’s) and Iban García del Blanco of the Spanish Socialist Workers’ Party (PSOE) all consented to reduce the rate of VAT on the arts and entertainment sector to 10%.

Cultural-sector VAT has stood at a record 21% since September 2012, when Mariano Rajoy’s People’s Party (PP) government – which declined to participate in the APM roundtable – increased the tax, which previously stood at 8%, in an effort to plug a hole in Spain’s public finances.

The 21% rate of the VAT has been catastrophic for the Spanish concert market, with revenue from ticket sales falling 27.5% between 2012 and 2013 alone

The tax hike has been catastrophic for the Spanish concert market: revenue from ticket sales fell 27.51% between 1 September 2012 and summer 2013 alone, and the country’s live music industry has only recently recovered to pre-2011 levels.

Del Blanco, who also called for the harmonisation of VAT rates at a European Union level, said culture is currently something only available to the rich and powerful, and spoke of the need for action on ticket touting and the closure of music venues.

For C’s, said Rivera, the arts provides more than just “cultural enrichment”: it’s an industry that “generates income and employment with a much higher quality than other sectors”.

Maura also levelled criticism at collecting society SGAE, which has long imposed an “abusive” 10% tariff on Spanish box-office receipts, and called for a new economic model to sustain Spain’s cultural industries.

 


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