By June 13, 2012 Read More →

Booksellers cry foul at VAT hike on literature



French booksellers are worrying that a hike in VAT will drive another nail in the coffin of France’s cherished network of independent retailers.

By Julien PEYRON

Books have always been prized in France, a nation that has produced more Nobel literature laureates than any other country.

And because of strict price controls, France also has one of the most diverse retail networks in the world.

But the announcement that VAT will go up on all but the most essential items – and books are deemed non-essential – has terrified France’s independent booksellers.

The tax, currently at the reduced rate of 5.5%, is due to go up to 7% at the beginning of 2012, adding 30 centimes to the price of a 20-euro paperback.

And while the rise is hardly astronomical – VAT is at 19.6% for most other non-essential items – bookshops fear that the government is recklessly leading an assault on their industry without considering the cultural consequences.

Philippe Leconte, who has been a bookseller for the last 27 years and runs a shop in Paris’s 14th arrondissement, is furious.

“Everyone knows books are essential to life,” he said. “And now the government wants them classified as luxury items. It is a catastrophe.”

Leconte is happy to criticise French President Nicolas Sarkozy, who in September famously mispronounced the name of French literary theorist and philosopher Roland Barthes, and hints at a philistine disregard for literature in favour of more low-brow cultural activities.

“How can the country justify keeping the reduced VAT for entry to amusement parks, and then raise it on books?” he asked.

Network

France has some 3,000 independent bookshops – a rarity in the developed world where big chain stores and the Internet have undercut the profits of the humble independent retailer.

Sylvia Whitman, who owns the English-language bookshop Shakespeare and Company opposite Notre Dame Cathedral in central Paris, worries that France, which has a long tradition of supporting booksellers, risks losing a valuable cultural asset.

“In the last 15 to 20 years in the UK, small bookshops have been closing down one after the other,” she said. “We must not raise the cost of buying books if we don’t want to see the same thing happening in France.

“Books should be affordable and accessible to everyone, and all our visitors say how lucky we are to have so many independent shops.”

While retailers feel threatened, the very presence of a large network of independent stores is testament to legislation that actively protects literature from the ravages of chain stores and the Internet.

In place since 1981, the “Single Book-Price Law” stipulates that all books must sell at the price marked by the publisher.

In comparison, the UK (which imposes zero VAT on books), has no legislation to control prices. Chain stores and supermarkets often sell top titles at huge “loss leader” discounts to attract customers, a practice that has decimated the number of small bookshops in Britain.

In fact, French retail rules prohibit stores from selling any product at a loss outside of strictly proscribed “sales” periods.

Profits

“France is the only country in the world where booksellers made a profit from the Harry Potter series,” said Philippe Leconte. “With the Single Book-Price law we can sell at the same level as the big stores, and people come to us because we can offer a personal service and advise people on what to buy because we understand their tastes.”

The government is aware that booksellers are unhappy with the change and has launched a ministerial “mission to accompany the book sector through the transition to 7% VAT.”

Culture Minister Frédéric Mitterrand and Budget Minister Valérie Pécresse said in a statement they were concerned about how the transition would impact the independent book retailers.

Leading the negotiations for the retailers is Guillaume Husson of the Syndicat de la Librairie Française trade union, who said he was determined to protect France’s unique network of bookshops, which he described as the “most extensive in the world”.

“This rise in VAT is a big surprise,” he said. “There has always been a strong will by our politicians to protect the status of books and the health of the industry.”

Asked if France’s political class was falling out of love with the country’s literature, Husson said there had been a noticeable shift.

“Until very recently we felt supported by the government. A rise in VAT on books would have been unimaginable. But here it is.”

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