You are viewing your 1 free article this month. Login to read more articles.
The Booksellers Association (BA), Publishers Association (PA) and the Independent Publishers Guild (IPG) have voiced their concerns about the tax rises and public spending cuts announced by the chancellor Jeremy Hunt in the autumn statement.
Members of the industry are worried that younger employees, particularly those working from home, are in for a "tough winter", while others are concerned the temporary freeze on certain taxes does not assuage concerns caused to small and medium-sized enterprises by business rates.
Announcing the budget yesterday (Thursday 17th November), Hunt unveiled a package of tax rises and public spending cuts, amounting to several billions of pounds, in an effort to turn around the UK’s economic situation.
He has extended the energy price cap for another 12 months, but the average household will now pay £3,000 a year, rather than the £2,500. Income tax personal allowance, main national insurance and inheritance tax thresholds have been frozen for another two years, until April 2028, which will also pause the business rates multiplier.
The Office for Budget Responsibility predicts soaring inflation is set to hit disposable income by the largest amount since records began in 1956, representing a 7% drop in living standards, according to the BBC.
Howard Davies, head of policy and public affairs at the BA, said he was pleased that business rates would be frozen, but that doesn’t fully address the extent of the problem.
“The BA welcomes the government’s indication to protect retailers from rising inflation by freezing the business rates multiplier," he said. "And we welcome the plan to reform transitional relief, which should help booksellers of all sizes in areas such as the north of England, it should also help address some of the ‘bricks v clicks’ tax imbalances – as the announcement states that online marketplace warehouses will now pay higher bills.
"The changes announced don’t however fully address the inherent flaws and lack of fairness in the business rates system, which needs fundamental review."
However, the BA said the extension of the energy support package for households has the potential to help shore up consumer confidence, especially in the lead-up to Christmas and the busiest trading period. It also welcomes the announcement of extra funding towards the enhancement of digital markets capabilities of the Competition & Markets Authority, which "should put the high-street in a better position to challenge the giant online monopolies, which have already damaged consumer choice across the book industry," Davies said.
Dan Conway, c.e.o. at the PA said the company "strongly welcomes" the government’s commitment to bring forward the Digital Markets, Competition and Consumer Bill, and the increase in school funding.
"Digital markets are our future, and this bill is key to ensuring that global tech brands operate fairly for UK consumers and businesses. We look forward to working with DCMS to ensure publishers remain at the forefront of their mind during the passage of the bill.
“It is also promising to see an increase in funding for schools. We know that teachers want to see investment in their work and the resources to make their own decisions about what is best for their students. It is right that the government invest directly in schools and other initiatives that will help ease the burdens on teachers and improve leaner outcomes."
Despite the optimism, the PA also acknowledged "difficult times lie ahead for people and businesses across the UK".
"The government is facing a challenging economic period and must focus on securing a stable business landscape, that will help rebuild and grow the economy," he added.
Bridget Shine, c.e.o. of the Independent Publishers Guild, said public spending cuts are likely to affect publishers’ resources, and expressed concern for more junior members of staff in the industry. “There’s not much in the autumn statement to alleviate the challenges faced by people in publishing," she said. "The soaring costs of energy, food, mortgages, rents and other essentials will make it a very tough winter, especially for the many young professionals now working from home."
The guild is concerned the new freeze on tax allowances and thresholds means employees will lose some of what they might gain in salary increases, through paying more tax.
"The chancellor’s predictions about a shrinking economy, continued high inflation and increased unemployment all make it a bleak outlook for businesses as well as individuals," Shine continued. "New money for schools in England is welcome for education publishers, but public spending cuts may well compromise purchases of some learning and professional resources at some point.
"However, independent publishers constantly show their resilience, and they will draw on all their agility and resourcefulness to tackle these challenges."
Barbara Hayes, chief executive of The Authors’ Licensing & Collecting Society, fears the current economic forecast is "concerning" for writers. "We had hoped that more could be done to shore up our creative sector and the future of UK creators in the face of these concerns" she said.
"It is vital we work to protect the local and grassroots culture across the country that is the foundation of our incredibly successful creative industries. Among other measures, we would have hoped to see further Department for Digital, Culture, Media & Sport (DCMS) budget to support vital levelling-up arts projects, which give communities agency to generate their own local cultural infrastructure.
"A recent DCMS committee report reaffirmed the importance of libraries. However, a County Councils Network survey showed these vital spaces are at a high risk of closing with further cuts. Councils must be properly funded to fulfil their offering to local communities.
"We need to support local grassroots culture and infrastructure so our creative sector can continue to do what it does best: delivering economic and cultural value by drawing on the strength of UK creatives across the country.”