CMU Daily on closing the Channel Islands VAT loophole

The CMU daily a news letter sent out to most in the music industry described the chancellor’s plans to reduce the threshold for those avoiding VAT by being based in the Channel Islands to £15 from £18 as “slightly less than fuck all. But only just”. Over the last three years new release sales for bigger artists in shops have dwindled to next to nothing. Albums are often available cheaper to the public than shops can buy them from the record company based on the avoidance of the VAT. People are also understandably fed up with prices dropping so quickly that they wait for the album to be reduced to £5 or £6 sometimes within a matter of weeks online.

There are enough people out there who would still prefer to buy their music from independent shops and probably enough to support a scaled down HMV if they could just be sure that they weren’t paying more than they need to and that the price would not change at least for the first few months. That does not seem an unreasonable expectation to have. The £15 limit changes nothing for CDs and little even for DVDs. Some customers will always prefer the convenience of buying online and some will prefer the personal approach of a shop. All the shops are asking for is a level playing field and as soon as possible.