Coronavirus: Theatres eligible for Sunak's VAT reduction

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The government has announced that VAT for theatres and circuses will be reduced from 20% to 5% until January 2021.

Chancellor of the exchequer Rishi Sunak announced the VAT reduction for the hospitality and leisure sectors during his mini-budget on July 8, and culture secretary Oliver Dowden subsequently confirmed that theatres and circuses will be eligible, along with concerts, fairs, amusement parks, museums and cinemas.

Pleased to confirm VAT cut from 20% to 5% for “attractions” announced by @RishiSunak includes

Shows, Theatres, Circuses, Fairs, Amusement Parks, Concerts, Museums, Zoos, Cinemas & Exhibitions

We will announce further steps on path to reopening shortly@EquityUK #PlanForJobs pic.twitter.com/V04WNPMXQM
— Oliver Dowden (@OliverDowden)
Pleased to confirm VAT cut from 20% to 5% for “attractions” announced by @RishiSunak includes

Shows, Theatres, Circuses, Fairs, Amusement Parks, Concerts, Museums, Zoos, Cinemas & Exhibitions

We will announce further steps on path to reopening shortly@EquityUK #PlanForJobs pic.twitter.com/V04WNPMXQM
— Oliver Dowden (@OliverDowden) July 8, 2020

Equity tweeted to thank Dowden for clarifying that theatres will be included, and said the move will be welcomed by its members.

However, MP Tracy Brabin argued that the VAT cut will not help theatres while they are still unable to open.

She tweeted: "The VAT cut will be welcome to many that can open, however it doesn’t yet help many creative companies, such as theatres who have no timetable to reopen."

Additionally, some not-for-profit theatres that qualify for Theatre Tax Relief are already exempt from VAT for their ticket sales.

In a statement on the chancellor’s mini-budget, Equity also commented on the government’s new £2 billion Kickstart scheme, which will subsidise six-month work placements for people aged 16 to 24 who are on Universal Credit.

Equity said: "Unions including Equity must be consulted as to how the Kickstart scheme can be applied to, and work effectively, in the entertainment industry.

"New creative graduates are emerging into an industry in crisis and many have not been supported by the Self Employed Income Support Scheme.

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"The Kickstart scheme could be a lifeline for these young workers but must not undercut union agreements, and there must be a guarantee that wages are topped up to the collectively bargained or industry standard rate."

The government also announced £1 billion in funding for the Department for Work and Pensions, which will be used to increase the number of staff at job centres.

Equity said: "All too often the highly skilled creative workers are not understood or supported by the social security system.

"The increase in recruitment of work coaches for job centres must be accompanied by training and appropriate guidance on supporting self-employed and creative workers."

Chief executive of the Creative Industries Federation, Caroline Norbury, said of the chancellor’s statement: "Supporting the next generation of talent is a high priority with our members. We stand ready to test new models and ways of working to ensure that the future of the next generation of talent is secured, young people and freelancers are supported, and unemployment tackled.

"Alongside support for job creation, government should further unlock the creative potential of the next generation by supporting new start-ups and freelance work, and by introducing greater flexibility to the apprenticeship system."

Head of BECTU Philippa Childs repeated calls for additional support for freelancers.

She said: "There were millions of forgotten freelancers and others across the country hanging on the chancellor’s every word, but once again the government has let them down and failed to recognise the plight of those who have fallen through the gaps.

“The government has announced a welcome £1.5 billion to support creative institutions, but there needs to be extra support to help freelancers who are the backbone of the creative industries.

“If they do not, then the future of the £100 billion sector is at risk as highly skilled freelance and self-employed workers are forced to seek work elsewhere."