A review of newspaper pricing by Gript Media has shown that there have been no reductions in the price of Irish newspapers since the Government cut the VAT on newspapers from 9% to 0% at the start of the year.
The failure to pass on the savings to consumers is particularly interesting given that Vincent Crowley, then chair of NewsBrands Ireland, the representative group for Irish newspaper titles, previously told the Oireachtas Joint Committee on Media that the cut “reduces the cover price for the consumer, be it a consumer of a digital subscription or a consumer of a physical print paper.” This, he said, “makes it cheaper to buy the paper, which, in theory, increases sales or the number of subscriptions.”
He did then go on to note that, if newspapers “did not pass on the full amount of the VAT reduction,” they would use the money to reinvest in their “newsroom or whatever.” This, he said in response to a point made by Ciarán Cannon TD that his son had never bought a physical newspaper, would make newspapers “fit for purpose to service his 24-year-old son.”
NewsBrands Ireland had long campaigned for the cutting of the VAT rate, saying that it was “an unjust tax on information, learning, and democracy.”
At the time the cut was announced the CEO of NewsBrands Ireland, Ann Marie Lenihan, said that the move was recognition by the government of “the value of newspaper journalism in society and democracy.”
NewsBrands Ireland had argued that the cut in VAT was “absolutely crucial to the future viability of the news publishing industry in Ireland,” and that implementing the cut would be “transformational” for the newspaper sector.
Critics of the move argued that the VAT cut was less about an unjust tax on democracy and more about bringing in what would effectively be a state subsidy of a sector which has found itself increasingly adrift.
Pascal Donohoe, during his tenure as the Minister for Finance, estimated that the cut would cost the Irish state €33 million a year.