Finnish biz slams proposed VAT increase on tickets

Finland’s live music associations are sounding the alarm over a proposed increase in VAT on concert tickets.

Under the government’s new budget proposal, value-added tax on tickets for cultural and sports events will rise from 10% to 14% from 1 January 2025.

Trade bodies have called the hike “unreasonable” and have warned that the proposal should not be implemented under any circumstances.

Jenna Lahtinen, executive director of the live music benefit organisation LiveFIN, points out that the industry is still recovering from the losses sustained during the Covid-19 pandemic.

“Festivals, concert venues and the entire event industry have just completed their first full year of operation,” she says. “The industry does not need any decisions that weaken growth and profitability right now. An increase in the VAT on entrance tickets would be a hard blow to the industry.”

“The festival sector simply cannot stand it”

Laura Haarala, executive director of the Association of Finnish Program Agencies and Agents, adds: “The increase in the costs of the events industry has been very strong since the coronavirus. Costs have risen considerably higher than the general level of inflation. This has already affected the profitability of the companies in the industry, despite moderate ticket price increases. The increase in value added tax will increase the pressure on price increases or weaken the profitability of program sales.”

Sami Kerman, CEO of the Event Industry Association, says the proposed increase will “inevitably affect demand for events”.

“When Finland is already in recession and the uncertain situation of companies is reflected in the cyclically sensitive event industry, especially corporate events, it would be especially important to take care of the demand for consumer events,” says Kerman. “If we are going to stick to the VAT increase, decisions are needed to stimulate demand accordingly.”

While Kai Amberla, executive director of Finland Festivals, has warned that the festival sector industry “simply cannot stand” the hike.

“The Corona era showed how important festivals and other cultural events are for people,” says Amerblia. “After the pandemic, the economy of art and culture festivals has been faced with huge challenges, but with strict financial management and very moderate ticket price increases, we have been able to get back on the path to growth. It is completely irresponsible that at the same time cultural policy subsidies are being cut with a heavy hand, there is a proposed to increase the value added tax on admission tickets.”

The associations are hoping the government will revoke the decision in the framework rush of spring 2024.

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