A cut in VAT and a new levy on arena and stadium tickets are urgently needed to stop grassroots music venues from closing, MPs have said.
A report by the Culture, Media and Sport Committee said artists are facing a “cost-of-touring crisis”, with venues stopping live music or closing entirely at a rate of two per week.
The cross-party inquiry heard from the Music Venues Trust (MVT), which said 2023 has been the most challenging year for the sector since the organisation was founded in 2014, while Creative UK said the grassroots music sector took a “battering”.
In total the number of grassroots music venues (GMVs) declined from 960 to 835 last year, a net decrease of 13%, representing a loss of as many as 30,000 shows and 4,000 jobs.
The closures come against a backdrop of spiralling costs due to rising rents and energy bills, while audiences are cutting back on expenditure due to the economic climate.
There has also been a behaviour shift among younger people, who are spending less on food and alcohol.
The report calls for a temporary VAT cut based on venue capacity to “stimulate grassroots music activity and help the sector through the current closure crisis”.
The committee has also recommended a widespread voluntary levy on arena and stadium tickets to be in place no later than September, which should be used to create a support fund for venues, artists and promoters and not be passed on to music fans.
MPs said that if there is no agreement by September or if it fails to collect enough income to support the sector, the government should step in to introduce a statutory levy.
‘Music faces a bleak future’
Dame Caroline Dinenage, chairwoman of the committee, said: “We are grateful to the many dedicated local venues who gave up their time to take part in our inquiry.
“They delivered the message loud and clear that grassroots music venues are in crisis.
“The ongoing wave of closures is not just a disaster for music, performers and supporters in local communities up and down the country, but also puts at risk the entire live music ecosystem.
“If the grassroots, where musicians, technicians, tour managers and promoters hone their craft, are allowed to wither and die, the UK’s position as a music powerhouse faces a bleak future.”
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On top of immediate financial help through a levy-funded support fund and a targeted temporary VAT cut, the report says a comprehensive fan-led review of live and electronic music should be set up this summer to examine the long-term challenges to the wider live music ecosystem.
The UK music industry brings billions of pounds into the economy, attracting both domestic and international tourists to live events.
British popstar Adele started out in grassroots venues. Pic: AP
But festivals, electronic music venues, academies and arenas “are not insulated from the impacts” of the crisis and “promoters are less able to put on shows or make them financially viable”, MPs warned.
The report was welcomed by industry figures, though Mark Davyd, chief executive and founder of the MVT, said it has “taken much longer than any of us would have liked to get the positive change we all wanted to see”.
The trust – which represents more than 900 grassroots music venues across the UK – has previously voiced concerns that emerging artists with the potential to be the next Ed Sheeran or Adele – both of whom started out playing in grassroots venues – could find their careers cut off at ground level, never realising their full potential.