(Reuters) – Spotify announced on Thursday a price increase for its premium subscription in France, the group citing additional costs on its services linked to the “CNM tax” (National Music Center), imposed by the State on services music streaming.
As part of its 2024 budget, the French government decided last year that digital music streaming services will now have to pay a new tax of 1.2% on their turnover generated in France.
“Clearly, all our French premium users will see their subscription increase, and will now pay the highest package within the European Union,” said the Swedish group in a press release, adding that the amount of the increase would be announced in the coming weeks.
The CNM, a public organization, carries out studies on the music industry and provides financial assistance to record companies and the live performance sector.
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The tax, which should bring in around 15 million euros this year, “will not finance the CNM, the operation of which is ensured by the State, but it will finance creation and diversity”, declared Jean-Philippe Thiellay, director of the CNM, during an interview given to France Musique last year. “100% of this tax will be re-injected into the sector.”
Spotify nevertheless denounced a “consequential” amount, the group affirming that it would have to pay around two thirds of each euro to the rights holders and the government, thus threatening its financial sustainability.
“We have always been very clear on this matter – we simply cannot absorb additional taxes,” the group added.
In December, the music streaming service announced it was cutting around 1,500 jobs, or 17% of its workforce, citing rising costs.
(Written by Dimitri Rhodes, with Ingrid Melander, edited by Blandine Hénault)
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