BERLIN (dpa-AFX) – After the lack of state funding for media companies for the delivery of printed newspapers and magazines, magazine publishers are once again pushing for a reduction in VAT on press products. The federal managing director of the Media Association of the Free Press (MVFP), Stephan Scherzer, told the German Press Agency: “Regardless of the delivery funding being discussed, the reduction in VAT for the magazine and newspaper press would be perfect from a regulatory policy point of view. It would also be a support for transformation, because “Everyone who makes sales – printed or digital – would be supported by a reduced VAT.”
Scherzer added: “No additional bureaucratic apparatus would have to be set up. The adjustment could be implemented in the annual tax law without major effort and without approval from the EU.” The VAT on newspapers and magazines is currently at the reduced rate of seven percent.
Burda manager Philipp Welte, who is also MVFP board chairman, recently spoke out in favor of the reduction in a “Handelsblatt” report. As early as the summer of 2023, the new leadership of the Federal Association of Digital Publishers and Newspaper Publishers (BDZV) called for the abolition of VAT on newspapers. Media Minister of State Claudia Roth (Greens) told the German Press Agency in December: “It would be an important step if the VAT was further reduced from 7 percent.”
Publishers’ associations have been calling for government support for years because media companies have higher costs when distributing printed newspapers and magazines due to, among other things, energy prices, inflation and the minimum wage. Circulations have also fallen in recent decades. There are fears that press diversity could decline, especially in the regions.
State funding for press houses has also been discussed in federal politics for years. There have been several attempts and models – so far nothing has been implemented. In the most recent budget negotiations for 2024, no funding was included in the plan. The traffic light coalition agreement includes the examination of funding options.
Regarding the economic situation of magazine publishers, Scherzer said: “The pressure is at least as great as at the beginning of 2023, and in my opinion even greater due to the AI transformation that we have been in for a year. All business models for refinancing press offerings must be under great pressure “At least I currently see that paper prices will not continue to rise to astronomical heights.”
Scherzer added: “Revenue from readers is the key to the future success of press publishers. Advertising revenue is important, but revenue from readers is central.”
When asked whether there were signs that there could be a discontinuation of magazine titles in the current year, beyond the normal movement, Scherzer replied: “Not at the moment. But the risk increases due to excessive regulation, high production costs, necessary investments in the future Transformation and in the digital world through largely untamed monopoly platforms.”
Recently, the newspaper publishers’ association Federal Association of Digital Publishers and Newspaper Publishers (BDZV) published a trend survey among media experts. Accordingly, the decline in circulation of printed newspapers in Germany will increase. At the same time, digital subscriptions will grow significantly. The forecast is that the decline in the print advertising market will moderate somewhat.
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