Tuesday 28th November 2006The Icelandic government has announced that it will cut the tax on recorded music from 24.5 to seven per cent from March 2007.
Iceland currently has the second highest rate of sales tax on recorded music in the world, lower than only Hungary and Norway, who both levy rates of 25 per cent.
The reduction follows a 20-year campaign by the country's music industry.
'Music is a powerful means of expression, underscoring important moments in peoples lives and evoking strong emotion,' said Gunnar Gudmundsson, representative of IFPI Iceland. 'Since music is such an essential part of Icelandic culture, we believed that it was unfair to impose a higher rate of VAT on sound recordings compared to other cultural goods.'
The government has also announced the formation of Music Export Iceland to promote the export of Icelandic music such as the Sugarcubes, Björk and Sigur Rós.
European music industry bodies, including the UK's BPI, have called for EU-wide reductions in sales taxes on recorded music. The BPI has also called for tax credits on UK record companies' 'R&D' spending, although they already receive a considerable public subsidy in return for airplay (free advertising) on the BBC's radio stations.
Source:
http://www.pcpro.co.uk/news/hot-topics/98885/iceland-backs-lower-sales-tax-on-music.html
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