Why the plan for a “streaming tax” targeting Spotify, Deezer and Apple Music is controversial

Spotify, Deezer or AppleMusic will they soon have to checkout? Six Nupes deputies want music streaming players to donate 1.5% of their income. This “streaming tax” would be used to finance the National Music Center (CNM) which aims to support French creation. But the proposal already worries both the platforms and certain artists who have castigated an “unfair” tax. Explanations

What would this tax consist of?

Filed on September 30, an amendment to the finance bill aims to tax the music streaming giants. Behind this proposal, six deputies of the group “Democratic and Republican Left – Nupes” – Stéphane Peu, André Chassaigne, Frédéric Maillot, Karine Lebon, Nicolas Sansu and Jean-Marc Tellier – who wish with this tax, to partially rectify the accounts of the CNM , an institution deemed “in danger” and which “cannot fully play its role of supporting creation”. In other words, streaming must now make its contribution to it, judge the elected officials.

Concretely, the project provides that Deezer, Spotify or Apple Music donate 1.5% of their income to support creation. As a reminder, the national music center created in 2020 and placed under the supervision of the Ministry of Culture and Communication, aims to support music and variety professionals.

On paper, the proposal thus takes up the main lines of the “YouTube tax”, also called “Netflix tax”, voted in 2016, to finance cinematographic creation in France. The measure should bring in 21 million euros, according to the deputies. And could come into force on January 1, 2023, if it wins the vote of the deputies.

What reactions?

The actors remain for the moment very divided. The first employers’ union for private entertainment in France (PRODISS) underlined in a press release that “a very small contribution, around 1.5%, could be enough to complete the CNM financing scheme without disrupting the economic models”. An opinion opposed by other representatives of the sector who point to the financial difficulties that these platforms are already encountering. Because despite their insolent growth, Spotify, Deezer and Apple Music are still struggling to achieve profitability. Taxing paid streaming sites could then result in higher subscription prices for consumers.

“This new levy is indefensible in times of inflation and threats to purchasing power”, criticizes EchoesBertrand Burgalat, owner of the National Syndicate of Phonographic Publishing (SNEP) which brings together the music majors but also independent labels. “His supporters assure that it is only a small tax, with a low rate of 1.5%. It’s a classic process: when you want to swallow the bitter pill of a new tax, it starts with a low rate but which will go up afterwards, ”he believes.

For others, this tax would first benefit the American giants. Questioned by Politico, Ludovic Pouilly, vice-president in charge of relations with the music industry and institutions of Deezer judges as well as “increasing our prices would serve the interests of other platforms on the market, and in particular Google, Facebook, Amazon and Apple”. Alternatively, the tax could lead to a reduction in the remuneration of producers and artists. Some did not hide their concerns.

Why would rap be particularly targeted?

Barely mentioned, some artists already consider this proposal “unfair”. Among them, one of the most popular figures of French rap Niskabut also Dosseh, Housbad or the producer Oumar Samake have denounced an “anti-rap” and “racist” tax.

The explanation? Rap remains one of the most streaming-dependent styles of music. This online listening represents more than 87% of the consumption of rap albums in the Top 200 France, in the first half of 2020, according to SNEP. On the contrary, variety remains little listened to in streaming (17%), as does pop (38%).

In addition, rap concentrates a considerable part in the whole of the French musical production. At the start of 2020, 85% of the so-called “urban” songs in the Top 200 Albums were French productions, compared to 55% for pop, 60% for electro/dance and 20% for rock, still according to the union.

Rap is therefore likely to be the register contributing the most to the financing of the CNM and its subsidies. A situation that is all the more problematic in that no artist or professional from rap sits on the bodies of the sector.

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Why the plan for a “streaming tax” targeting Spotify, Deezer and Apple Music is controversial

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