TAXATION / PLANNING
Live events sector
The UK festival industry has been given more time to prepare its case on how business rates are assessed against agricultural land that hosts music events. Music Weeek reports that a Live Nation led coalition of 720 interested parties, including the Association Of Independent Festivals (AIF), UK Music, The Agents’ Association, The Concert Promoters Association and The Association Of Festival Organisers, has called for an immediate halt to the rating of festival sites for business rates by the Valuation Office Agency until a clear policy is established. “We do not consider that festivals and events sites should now be rateable as they are essentially temporary and ancillary uses of agricultural land,” it said in a letter to MPs. The proposed changes including backdating the rate bill for five years, and could put the future of some festivals at risk as rural landowners take stick of financial risks. Last week’s Spending Review by Chancellor George Osborne did not include an announcement on the Business Rates Review, which will now revert to March 2016. AIF general manager Paul Reed said events and festival organisers are hoping the Government will use the extra time to take action on business rates for the sector.
Steve Heap, General Secretary of the Association of Festival Organisers, said the events and festivals sector is not a cash cow to be milked at will, saying in an article in Stand Out magaizine “Did you ever feel ignored? Perhaps some festivals were, through the banking crisis of 2009 up to 2013 when the festival industry was going through difficult times. Even when London 2012 was on, the regular festival scene was taking a knock. Grants were impossible. Sponsors focussed on all things Olympic. But most of us managed to survive because we did what we always do. We budgeted accordingly, we cut our cloth and we set achievable targets. The festival scene continues to grow and is good at it” adding “Through those difficult times we still supplied audiences with the arts, we paid into musicians funds through PRS, we still contributed to local and national economies through our customers, and we survived. But we did most of it without receiving any help” and that at “the Valuation Office Agency – somebody has decided that festivals on greenfield sites should be paying business rates. That could cripple, even close down, several events and festivals especially if they pursue the proposed backdating and “So, agents and managers, suppliers, local authorities, Police, VOA, PRS and festival and event organisers – can we please stop this nonsense, which assumes every year that costs MUST go up when in fact they could come down. That will level out ticket prices. More people will then be able to afford to buy tickets and, as a result, the event remains solvent, successful and continues to contribute to the local and national economy, both directly and indirectly.
In an article in City Metric, Shain Shapiro comments on the threat to music venues in the United Kingdom saying that we have “to recognise a problem: Britain’s music venues are in trouble. And this trouble affects much more than the music staged in them. It impacts the cultural makeup of our cities, and moves our conception of value away from what happens inside a building, and onto how much the bricks and mortar are worth.”. Noting research from the Music Venue Trust, which concluded that London saw a third of its venues disappearing in between 2007 and 2015 and that pther parts of the country, from Glasgow to Leeds, Cardiff to Newcastle, were seeing venues closures as well and that a number of factors contributed to this, including noise issues, regeneration, management and the housing crisis, Shapiro says “We must understand the value our music venues and nightclubs have to our local economy. Each building is in and of itself an incubator, supporting as many businesses a tech startup hub. A successful establishment has bars, staging, lights, food, drink, security, and talent. Each of those is its own industry sector. Losing our venues meant losing our business as a whole” adding that one culprit was Britain’s planning and licensing system: “Amendments to planning law had emphasised housing over anything else, including music venues. Licensing restrictions crippled independent businesses. The cost of land – including rent, rates and tax – had made running a venue unviable. The venue, as we know it, became a market failure, despite it amplifying and supporting many other markets. Something needed to be done” but on a more positive note Shain goes on to note that “Fast forward to October 2015. In less than a year, two parliamentary debates had recognised and discussed this issue. Two events were established to further the debate, Venues Day and the Music Cities Convention. A landmark report, the Rescue Plan for Live Music Venues in London, was released; its recommendations are now being debated and planned. And the role of our music venues have been debated at the Planning Officers Society and licensing authorities, and in council chambers up and down the country” and applauds the recent amendment proposed by Labour which would adopt the “Agent of Change” principle, which would shift responsibility to the developer, as long as the venue stays within its license. At the same time, a number of new venues are being planned across the country, from Denmark Street in the London’s West End, to the Royal Docks, to the MAC Quarter in Sunderland. London’s “Night Mayor”, a recommendation in the rescue plan, is likely to be announced soon; the night tube, an indicator of a shift towards an economy that operates around the clock, will create safer routes for people to get to and from where they want to go.