UK Music writes to the Chancellor over Business Rate fears for live music

06 March 2017 - Press release

UK Music has written to the Chancellor of the Exchequer to express concerns about the potential adverse impact on the live music sector as a result of business rates.
The letter, written on behalf of the UK Live Music Group, calls for measures to be put in place in the Budget on Wednesday (08/03/2017) to mitigate the worst excesses of the revaluation of business rates to prevent harm to culture and creativity in communities.
In her letter, UK Music's chief executive Jo Dipple points out that venues in London could see rate increases of between 35% and 55% which could require £3 being added to every gig ticket.

The full text of the letter is attached and the key text is below:

Dear Chancellor,
I am writing to you in advance of the Spring Budget which you will deliver on Wednesday 8th March. This follows concerns expressed at a recent meeting of the UK Live Music Group in relation to the imminent business rates revaluation and the potential negative impact on the live music sector of these changes.

We ask that you use the opportunity of your Budget next week to put measures in place to mitigate the worst excesses of the valuation in order to avoid a detrimental impact on culture and creativity in our communities.

UK Music is the umbrella body representing the collective interests of the UK's commercial music, from songwriters and composers to artists and musicians, studio producers, music managers, music publishers, major and independent record labels, music licensing companies and the live music sector.

UK Music exists to represent the UK's commercial music sector, drive economic growth and promote  benefits of music to British society. A full list of UK Music members can be found in the annex. The music industry is worth £4.1 billion to the economy and generated exports of £2.2 billion over the past four years, out-performing much of the rest of the UK economy.

Live music is worth almost a £1 billion to the economy and employs 25, 150 people. The sector's exports, via music tourism, have  produced year-on-year growth of 35%. Venues act as important centres for cultural activity in our towns and communities. 24 million people attended gigs and concerts during 2015. 10 of the top 11 arenas in England will see increases to their business rates. Over half of these increases will be in excess of 45%.

The geographical disparity of the hardest hit venues ranges from the North West, North East, West Midlands, East Midlands and London so the idea that the rating revaluation is a fiscally-neutral rebalancing act from south to north to reflect property inflation is not borne out in reality for arenas. Whilst we understand that the intention of the revaluation is fiscal neutrality, it is evident that some sectors in the economy will be harder hit than others.

Grassroots music venues act as important hubs for local music talent and offer a means by which musicians and performers can cultivate and nurture their creativity. In the last 10 years the sector has come under substantial external threats, resulting in a decline of 35% in the total number of grassroots music venues trading in the UK. In London, grassroots music venues are facing business rate revaluations of up to 200%. Considering transitional and other reliefs this could still see rises between 35% to 55% and may require £3 being added to every ticket or £150 on every hire. Music fans will undoubtedly suffer, either through having to pay more or having fewer venues to attend due to closures. Recent positives measures from the Government to eliminate challenges for grassroots music venues will be undermined by significant business rate increases.

Beyond venues, music festivals also contribute significantly to our music industry with 3.7 million people attending festivals in 2015.  Festivals and events have historically benefited from an agricultural exemption to business rates. We ask that the exemption for festival and event sites is maintained to prevent further punitive measures from being imposed. In addition, any attempt to backdate business rates is completely arbitrary and unfair. This position for festivals and other outdoor events is supported by over 720 organisations, including members of those comprising the UK Live Music Group, the Events Industry Forum, the National Outdoor Events Association, Local Authority Event Organisers Group and British Visits and Events Partnership.

The Scottish Government recently announced an initial rateable value cap of 12.5% for the Scottish hospitality sector following concerns expressed by industries bodies relating to rate rises. UK Music would welcome your urgent consideration to also introduce measures that would ensure the music industry and its capacity for growth is not adversely affected by the business rates revaluation.

Yours sincerely,

Jo Dipple
UK Music