how is the music industry reacting?

The announcement of a new streaming tax to finance musical creation in France is causing online music listening platforms to react.

It’s not even a soap opera anymore, it’s a saga. For several months, the specter of this streaming tax has poisoned relations between different players in the music industry. The government finally announced, Wednesday December 13, a tax on the income of online music listening platforms from 2024. At stake, the financing of the National Music Center (CNM), created in 2020 on the model of the CNC for cinema, that is to say an organization dedicated to artistic creation and the financing of musical projects. Before the introduction of this tax, of which we know neither the amount nor the date of application for the moment, it was mainly live entertainment, festivals and theaters in particular, which financed the CNM. The large listening platforms do not participate in the measurement of their financial power.

A “strategic error”?

The streaming platforms did not hesitate to say all the bad things they thought about the new tax announced by the government on Wednesday. In particular through the voice of Antoine Monin, general manager of Spotify France, guest of franceinfo: “The adoption of this tax is really a blow to the music sector, to innovation and to European independent platforms like Spotify or Deezer. According to him, “it is also a monumental strategic error which goes against the issues of European economic, cultural and technological sovereignty. How do you expect us to be able to operate in a market like France? How do you expect the leaders of Spotify, seeing today how the French market operates, are saying to themselves ‘do I invest in France or do I invest in the United Kingdom, Germany or Sweden?’

Fair participation in the CNM

For Spotify, which says it pays 70% of its income to rights holders, this new tax is therefore a direct attack. Partners of numerous events such as festivals, Deezer and Spotify already believe they are investing a lot in France, and the Swedish giant is therefore threatening to leave the country, purely and simply. However, this tax is nothing other than the establishment of fairness for Aurélie Hannedouche, the director of the Syndicat des musiques contemporains (SMA): “Today festivals, concert halls and show producers already pay a 3.5% tax which goes to the CNM and fuels creation. So the objective with the creation of this streaming tax is that now all companies that can benefit from CNM credits are also contributors.”. And in the report by Senator Julien Bargeton, delivered last April, the range retained was around 1.75% tax on revenue from Spotify or Deezer.

A progressive tax

Not everyone is in the same boat. A principle of modularity and progressiveness, which the general director of Spotify France failed to mention, was retained. “Deezer, Spotify and Qobuz are not going to pay at all the same as Gafam, as Apple, Amazon, Meta and TikTok for example, explains Aurélie Hannedouche of the SMA, this means in concrete terms that the tax will bring less money to the National Music Center than if we taxed everyone at 1.75% but we prefer to make this concession to preserve them because they are allies, they are essential links in the system of musical creation.”

After many debates and outbursts, which this announcement has not yet calmed, the streaming tax will be a reality in 2024.