VAT on books reduced, goal to abolish it altogether


The reduction, from 9.5%, comes more than a decade after the publisher Sanje initiated a petition for a zero tax on books in 2006, to counter proposals for imposing the standard rate of 22%, which Sanje director Rok Zavrtanik says "would have been a disaster for what is a struggling industry as it is".

"At the time I examined global studies quite extensively and they all showed beyond doubt that every percentage of tax cut has a positive effect on trends, number of books published, prices and hence reading culture in a cultural environment," Zavrtanik has told the STA.

He finds the tax cut key to the efforts to promote literature and reading, and how individuals are knowledgeable and and how well informed, in particular in a language that in the global situation today "does not stand a chance to be successful as a business, let alone competitive".

Zavrtanik goes as far as saying that "tax on book and media is a covert form of censorship because it limits reading and access to reading and is one of the ways to destroy them through ignorance or market rules. And Slovenian books are pretty much on their knees."

Author and performer Andrej Rozman – Roza agrees: "If we don't think it's worthwhile preserving and developing our language identity (…) we can treat our language as a commodity. In that case this language will increasingly lag behind the languages covering larger markets."

In that case Slovenia will keep seeing a shortage of "quality popular production that would inspire people's enthusiasm about their own language identity, the keener they will be to speak foreign languages, keep silent in their own and feel inferior to members of larger language communities."

A public appeal issued by publishers and affiliated associations in April argued that books and print media were the backbone of a society's intellectual life; their demise would eventually cause an erosion of the society's potential and cohesive forces and a decline in democratic values.

Miha Klančar, director of marketing and sales at the newspaper publisher Večer, finds that the publishing crisis is a reflection of a radical change in reading habits, the related decline in circulation and financial strength of publishers.

Moreover, it is a reflection of a reduced number of employed authors and journalists, a deterioration in their financial position and position of everyone doing business with the publishers, coupled with an extremely disadvantageous tax system. There are also "huge asymmetries in allocation of advertising revenue among the media".

Considering that prices are formed freely on the market, it will depend on the business policies of everyone involved in the supply chain whether the lower VAT will reflect in lower prices of books and periodicals, which was the idea behind the measure.

Zavrtanik expects that prices will fall, but not as yet because it would cost too much to change the prices already printed on books, so that only new production will first reflect the new philosophy.

Klančar says that publishers have committed to spend the funds resulting from the VAT cut strictly as intended, that is to pay the authors and invest in production of demanding genres and in digital development. Like Zavrtanik he does not think the measure will solve problems in the long run.

The Public Book Agency believes that books should be completely exempt from VAT, because "it is ill-judged to tax print word in such a small language community as Slovenia's".

However, the agency does expect that the VAT cut will contribute to a more versatile supply of books and periodicals in Slovenian, make them more accessible and allow more sustainable business models for authors, suppliers and distributors.