Les Francofolies de la Rochelle and Printemps de Bourges will no longer be supported by Spotify in 2024, as the streaming service threatens to cut its investments in France in reaction to the government’s streaming tax. The Swedish giant accuses the French state of endangering streaming companies.
In 2024, the French government will launch a streaming tax. Companies in the sector, such as Spotify, Deezer or Apple Music, will have to pay 1.2% of their turnover to the State, in addition to other taxes already in force. The government’s objective is to force streaming to finance the National Music Center, to re-inject its revenue into the industry.
This streaming tax greatly annoys streaming services, who have been fighting for months to make it fall by the wayside. Spotify is the most virulent, since the Swedish giant threatens to cut its investments in France if the tax comes into force. Spotify justifies itself by the fact that it already pays 70% of its income to rights holders, in addition to 20% VAT. This new tax would be impossible to bear without increasing prices. Problem: its rivals Apple, Amazon and Google can easily absorb this difference and offer it unfair competition.
Spotify plays the funding strike card to put pressure on
Latest episode to date, two tweets published by Antoine Monin, the boss of Spotify France, on December 20. After declaring on France Info that Spotify could be forced to step back on the French market, Antoine Monin is taking action. He announces that Spotify will not finance the Francofolies de la Rochelle and the Printemps de Bourges in 2024. Why? No doubt to put pressure on the government, which has more to lose if Spotify abandons France than if Spotify pays it 1.2% of its turnover. In any case, that’s his bet.
Contacted by Numerama, Spotify France cannot tell us if this withdrawal is effective or if it is only a declaration for the moment. The most likely thing is that Spotify will use it to put pressure on the authorities, without having decided anything.
Is Spotify right to go on “strike”? Since the last speech of the boss of Spotify France, the Ministry of Culture has detailed its project, explaining that it intended to exempt from tax “ platforms with a turnover of less than 20 million euros “. Enough to call into question the argument of a law which would penalize the small ones for the benefit of the larger ones, even if it is true that Apple, which also sells smartphones and computers, has more diverse sources of income than Spotify . Regardless, a new price increase in France is possible in 2024, after several increases in 2023.
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