A previously record-breaking sales tax of 25% on books and magazines was in January 2002 downscaled to the customary EU level of 6%. The reduction came about after an enduring debate. Book publishers and booksellers had pursued an intense, and at times rancorous,campaign pressurising the political parties to reach a decision concerning a tax reduction.
The Minister of Culture, Marita Ulvskog remains sceptical as to the proffered positive effects of a tax reduction. Her opinion is that nowhere in the world has a reduction of the VAT for books been fully beneficial to the customer. And that the best means to increase reading awareness is to conduct selective ventures aimed at the reading habits of children and young people. The Government has made it a priority to improve reading conditions and during 2001 it funded 240,000,000 SEK towards book publishing, libraries and other beneficial reading endeavours.
The Swedish booktrade have collectively staked their claim that reduction of the VAT will primarily benefit the customer. For the purpose of scrutinising the effects of such a tax reduction the Government has appointed a book-price commission. The commission’s assignment will be to observe developments in price patterns, analyse possible consequences related to sales of books and magazines and to report to the Government on causes rendered on reading patterns in the process.
There will also be a series of investigations into price patterns running parallel to the work of the Book Commission. Such an investigation regarding book prices was conducted in 2001 by the Swedish National Council for Cultural Affairs and will be followed up later in 2002.
Libraries, as all publicly funded sectors, are exempt from VAT on books and magazines. Consequently, there are apprehensions being voiced from the library sector as to whether the publishing business will use this as an opportunity to increase prices,the aftermath of which could be detrimental to the purchasing power of libraries.
Translated by Jonathan Pearman