Speech by Jean Michel Jarre on behalf of the VAT Coalition

Hearing of the Economic & Monetary Affairs Committee
European Parliament

Brussels, 7th October 2003

I would like to thank the Economic and Monetary Affairs Committee for giving me the opportunity to speak on a subject close to my heart - music and the vital role it plays in European culture. Today, I am speaking on behalf of a VAT Coalition that represents organisations from across the music sector: from authors, composers, music publishers and performing artists to artist managers, independent and major record companies, entertainment retailers and collecting societies. But above all I am here as an individual artist because I am passionate about the value of music.

Here in the European Parliament, it feels like stating the obvious to say that music is an essential part of the fabric of cultural life in Europe. Yet this simple fact needs to be emphasised because the cultural importance of music is not reflected in EU tax policy.

An appreciation of music is deeply rooted in our society. European artists, some of whom joined me at a press conference this morning, produce a staggering variety of music from classical to techno and from folk to hard rock. In short, music is something that Europe excels at.

Yet in the European Union today, VAT rates on sound recordings range from between 15 per cent in Luxembourg to 25 per cent in Denmark and Sweden. On the other hand, cultural products such as books, magazines and newspapers, as well as entrance tickets for theatres, cinemas and concerts, benefit from reduced VAT rates of upwards of 5%. Sound recordings are not classified as cultural products for the purposes of VAT.

So why, I ask you, should a pornographic magazine benefit from a reduced VAT rate when a recording of a Mozart symphony does not? This situation makes no sense. The EU should seize the opportunity to put an end to this cultural discrimination against music by including sound recordings on the revised list of products eligible for reduced VAT. The difference in treatment of sound recordings in comparison to other cultural products cannot be justified.

I am not alone is feeling this way. Over 1,300 artists, composers and songwriters from across Europe have signed petitions calling for a reduction of VAT on sound recordings.

Many leading artists from the pop and rock world have signed including Elton John, Patrick Bruel, Carla Bruni, Eros Ramazotti and Julio Iglesias, to name just a few. Classical artists who have signed petitions include Cecilia Bartoli, Andrea Bocelli, Pierre Boulez and Anne-Sophie Mutter. These artists are joined by a whole range of local musicians and niche artists, all of whom make a vital contribution to Europe's cultural diversity and reputation for innovation.

Today, you are hearing from other sectors which I'm sure have good reasons for requesting a VAT reduction. But music is not just any other product. It's not just about putting beans in cans. We are talking about creativity and cultural expression and that is something worth cherishing in Europe. One important way of supporting European music would be to reduce VAT on sound recordings.

Consumers from around Europe also want a VAT cut on recorded music. Earlier today, entertainment retailers presented a petition signed by over 100,000 consumers calling for a VAT reduction on sound recordings. The Consumer Petition, which complements the previous Artists' Petition, was signed in retail stores and on music websites.

Consumers do stand to benefit from a VAT reduction on sound recordings. Both record companies and entertainment retailers have undertaken to maximise the benefits of any VAT reduction for consumers. So a VAT reduction would ease access to our music for all music lovers.

A five-country consumer study carried out by the research agency Martin Hamblin GFK in December 2002 indicated that a VAT reduction would lead to a significant increase in CD sales across Europe. This increase in sales would also go towards compensating government treasuries for the short-term losses a VAT reduction would mean for their treasures.

The European Parliament's Culture Committee has already voted to support a VAT reduction on sound recordings. Mme Zorba's new report on the cultural industries also supports reduced VAT rates for recorded music. We now ask this Committee to show consistency by sending a strong opinion to EU Finance Ministers in favour of a VAT reduction on sound recordings.

The European Parliament has always been the champion of European culture. I hope that we can count on your continued and active support.