Senior music venues have joined the chorus of voices calling for the government to introduce an online sales tax to fund business rates reform. Mark Davyd, boss of the Music Venue Trust, stated that fixing business rates is the difference between a room that can book the next big act and one that cannot make the rent.
According to Davyd, business rates are a significant burden on music venues, with the average annual rateable value for a UK music venue standing at around £44,000. This can equate to as much as 30% of their annual revenue, leaving many struggling to stay afloat.
The Music Venue Trust estimates that business rates reform could save the UK music industry up to £60 million annually. Davyd urged the government to consider introducing an online sales tax, similar to the digital services tax (DST) introduced in 2020, to generate revenue to support business rates reform.
This comes as the UK's business rates system faces increasing scrutiny, with many arguing that it is outdated and in need of reform. The Association of British Insurers (ABI) recently called for a fundamental overhaul of the system, citing its impact on small businesses and high street retailers.
The impact of business rates on UK music venues is not limited to small businesses. The O2 Academy Brixton, a prominent music venue in London, pays an annual business rate of £1.3 million, with the venue's owner citing business rates as a significant factor in their decision to increase ticket prices.