Backbench Business

– in Westminster Hall at 2:24 pm on 15 June 2023.

Alert me about debates like this

[Mr Virendra Sharma in the Chair]

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead 3:00, 15 June 2023

I beg to move,

That this House
has considered the matter of VAT on audiobooks.

It is a pleasure to serve under your chairmanship this afternoon, Mr Sharma. We are in the coolest place in Westminster, so let us see if we can stay in here; this is probably the only room with any decent air conditioning.

I will start by declaring an interest: as well as being a former disabilities Minister, I am also dyslexic. I was not diagnosed until I was in the military, when I was sent on a course and was told by an education officer that I was dyslexic. I thought that it was some kind of tropical disease. No one ever said to me at school when I had real struggles with English and maths, particularly reading, that I might have a learning difficulty. I was told by my headmaster that I was thick and I was not allowed to take my 11-plus exam—I would have failed it. But no one with dyslexia is thick; they just struggle sometimes with understanding words and mathematics. I also declare an interest in that I am a non-executive director of a law firm, even though, unlike the Minister, I am not legally trained.

Let me say at the outset that I would like this to be a genuine debate, because it is not an “us and them” situation. For people with visual impairment, or with dyslexia or another learning difficulty that prevents them from being able to read the written word as easily as most people, the subject of this debate is an anomaly that I hope we can try to resolve.

I know that there are discussions about the issue within Government; I think there were when I was a disabilities Minister back in the coalition Government, but it looked at the time as if it would be difficult to resolve. Campaign groups out there have said to me, “We should be able to take the Government to court” under the 2010 legislation, although of course the Government are exempt—under section 29. My speech might show that the Government should take note when it comes to other pieces of legislation, because the legislation as it is at the moment may well be technically illegal; I again cite the fact that I am a lay person and not a legal beagle.

According to the Publishers Association, in 2020 sales of audiobooks rose by 69%, which might have had a lot to do with covid. The Prime Minister, who at that time was the Chancellor, said on 11 March 2020:

“A world-class education will help the next generation thrive, and nothing could be more fundamental to that than reading. And yet digital publications are subject to VAT. That cannot be right. So today I am abolishing the reading tax.”—[Official Report, 11 March 2020;
Vol. 673, c. 290.]

He was talking about e-books, but I do not think that anybody out there knows the difference between audiobooks and e-books. Actually, I think the Government made a genuine mistake. We have zero VAT rating on books and publications of all types—whether that be academic, fiction or non-fiction—and e-books are exempt. Why were a whole group of people, from many different backgrounds, thrilled for a minute or two by the announcement, only to realise, once they saw the small print, that they would still be excluded?

For many of our constituents, audio is their only communication with the outside world and their way of finding out what is going on. If someone uses audiobooks to read fiction or non-fiction, perhaps, as we all want to do, they want to get on in life. Audiobooks are part of that process—for training, learning and education. We are holding them back by having 20% VAT on every audiobook they purchase.

People with disabilities are already being penalised extensively; Scope has said they are £970 per month worse off—a figure I recognise from when I was the Minister. We give people with disabilities other benefits, but if someone is using audiobooks extensively, that 20% is a huge amount of their income or household income. We are not just talking about people who are visually impaired or who are dyslexic, like myself. My form of dyslexia is quite minimal, but I tend to memorise everything. As Members have probably noticed, I do not tend to read from a script; I get much too wooden when I try to. In my case, it is much better to memorise most of the points that I want to raise.

My question to the Minister is simple. I know she cares passionately about making equality fair, but the Equality Act 2010 as it stands does not quite hit the nail on the head or do what is says on the tin. Does it protect all people from discrimination? In other words, does it protect people who need to use audiobooks from discrimination, when they have to pay 20% to be able to read? The rest of the population who can read visual books do not have to pay that.

Photo of Marion Fellows Marion Fellows Scottish National Party, Motherwell and Wishaw

Is it not true that young people especially enjoy audiobooks and it is a real path for them into the joy of reading? Some will not be able to discover that joy because of the expense, but it is how many first access literature?

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

I agree, and I hope that is part of the problem that the Minister, as a Treasury Minister, will recognise. It is difficult to work out how we can ensure that people who are being discriminated against—as opposed to people who can read in general terms; I will return to that point—have the ability to access audiobooks, while protecting the Treasury from the cost burdens. That is probably where the biggest problem lies.

If we were just talking about people who are visually impaired—a group of people who, without being rude, can be quite easily identified—the Treasury could make those calculations quite quickly. But what about when we get into the realms of what I was just talking about—people with learning difficulties, one of which is dyslexia? A huge percentage of those people have not had a diagnosis. How do you capture them?

To the point made by Marion Fellows: how do we take into account people who are not natural readers? I do not want to get into a class situation, but I did not read many books when I was at school because I struggled to read, and I know people who were in school with me who were not dyslexic but who just did not read. We want people to expand their knowledge, education and view of the world as much as possible, so if someone can read—they are not visually impaired—but they want to use audiobooks, should that not be okay? I think the Treasury would turn around and say, “How do you find the costs?”

I agree with the hon. Member for Motherwell and Wishaw, but I am just trying to play devil’s advocate. That is the only way we can do it. We do not know who uses e-books but they have been removed from VAT. All printed books and publications are exempt, but audiobooks are not. Even though it would be easier to define an exemption for a certain group of people—I vividly remember conversations about that when I was disabilities Minister—I do not think that would be fair, not least for the millions of people out there who are dyslexic but have never had a diagnosis; dyslexia covers a very large spectrum.

The Equality Act means that no one should be discriminated against because of their disability, sex or race—a whole list of things. Given that Parliament cannot be caught under the Act, I suspect that it might be disingenuous to tell outside bodies that they may discriminate. It would be saying, “We are not breaking the Equality Act, but we are telling you to do so.” Take an obvious example: a local authority that wanted to sell audiobooks would have to charge VAT—in a library, for instance—whereas there is no VAT on books. Parliament is telling an agency of Government—that is, His Majesty’s Revenue and Customs—to charge VAT on audiobooks. If it did so without an Act of Parliament, that would be discriminatory, but because we are exempt under section 29, it is not.

Long before the word “Brexit,” I was pretty well known for being what used to be called a Eurosceptic. I wanted to leave the European Union and for this country to have its sovereignty. But if there are laws on our statute books, we should use them. Section 6(1) of the Human Rights Act 1998 states:

“It is unlawful for a public authority to act in a way which is incompatible with a Convention right.”

There are other Acts of Parliament on the statute book. I am sure that there are plenty of lawyers who would argue one way and plenty who would argue another, but morally and ethically it cannot be right that there is legislation on the statute book—the Human Rights Act, the Equality Act and other European Acts—that states that we should not discriminate, and yet we are still in a situation in which someone who wants to improve their life for whatever reason is, by no choice of their own, penalised by our tax system. I am sure that the Minister will probably say that this is very complicated, and I know what her brief will say, because it is not dissimilar to the briefs that were given to me when I was sitting in that very chair. But because something is difficult, it does not mean it is right to do nothing about it.

One of my constituents, whose sight is failing—I will not in any way indicate who she is—is finding that her ability to work in commerce is being affected. She now relies almost completely on audiobooks, although there is also now software that will help people. She relies on audiobooks, and she does not want anybody to know that. She works from home and for her own reasons— I will not put words in her mouth—she wants to use audiobooks, because of her visual impairment. How can it be right that, if she needs an audiobook this week, she has to pay 20% on the product, but last month or last year, when she could read the publication, she did not have to pay that 20%?

Let us look at education for a second. This is where I deviate from the notes that people have helped me try to write—I will come back to some of it; people have been very supportive of me bringing this debate. Education books are quite rightly VAT-free, like all printed books. Audiobooks are not. The Minister will probably say that a lot of the VAT can be claimed back, but for individuals it cannot. If mum and dad, or grandpa and grandma, want to help their son, grandson or grand- daughter who is at a special needs school by buying them an audiobook, they cannot claim that VAT back, even if the organisation could. That child is being held back because the family perhaps do not have the money to buy the audiobook. For every five audiobooks they want to buy, one will be lost to VAT. We need taxes to pay for the schools that I have just alluded to, and for the education system, the health service and various other things. But for the public to have trust in our taxation system, it has to be fair and proportionate, and, in the public’s eye—because we are spending their money on their behalf—it has to be right and proper.

This has been going on for too long. It is worth reading the comments of the Prime Minister when he was the Chancellor:

“That cannot be right. So today I am abolishing the reading tax.”—[Official Report, 11 March 2020;
Vol. 673, c. 290.]

That referred specifically to printed books and e-books. Why on earth did it not include audiobooks? I really do not understand.

I will not be able to mention all the relevant organisations, but I have particularly been helped by Scope and the Royal National Institute of Blind People. The House of Commons Library has been fantastically helpful. I did not want the debate to be about me saying, “You’re a nasty, horrible Government, because you are not doing this”. It is not about that. Governments have not addressed this issue since before the current Government came in.

Things get left out when you are in government, and you think, “I wish I had done that.” I am leaving this House whenever the next general election comes, and I do not want to leave with a few things still on my bucket list that I wish I had done more about, perhaps when I was the Minister. I wish I had kicked harder when I was the disabilities Minister, particularly against my Treasury colleagues, so I am going to kick now for people who are suffering this 20% tax through no fault of their own, which surely has to be morally and ethically wrong.

Photo of Marion Fellows Marion Fellows Scottish National Party, Motherwell and Wishaw 3:17, 15 June 2023

It is a real pleasure to serve under your chairmanship, Mr Sharma, and as they say, “Follow that!” The previous contribution was a passionate and informed speech by someone who really understands the difficulties that the tax on audiobooks represents to some people. Sir Mike Penning, whom I congratulate on securing the debate, might not be legally qualified, as he said, but he certainly knows what he is talking about. I followed his argument carefully, and I love the idea of him ticking something off his bucket list. Any kind of persuasion that can be used to get rid of the tax is well worth using.

One of the reasons why I enjoy Westminster Hall debates is that they tend to be less contentious. They tend to be a meeting of minds, with people who are interested coming together to try to solve a common problem, which is not something that too many of our constituents see too often.

I also want to thank a number of organisations, especially the RNIB. In my time in this place, I have also been involved in the Axe the Reading Tax campaign, which led to the abolition of the tax on e-books. It is an aberration—an unintended consequence—that there is still a tax on audiobooks. I love audiobooks. I am a voracious reader—not of anything mind-blowingly interesting, I must say, but it is a great way to relax—and I know that many other people, especially those with visual impairment, dyslexia or other conditions, get great joy out of losing themselves in a good book for a few hours on an afternoon like today. There is nothing nicer.

Audiobooks benefit younger people, including people studying. I have to confess—I may have to ask Hansard not to record this, although I know it will—that I cannot read Dickens. I can read lots of older authors who are considered fantastic—I love Hardy—but I cannot read Dickens. I was required to read a Dickens novel for an Open University course I was doing, and I thought, “I can’t do that,” but an audiobook was my answer. I love listening to someone reading Dickens to me, but I cannot read him myself, so there are sometimes good educational benefits. If people who struggle to read can access the literature in a different form, it may pique their interest in reading. We all know that everyone, especially young people—and especially nowadays—benefits from sitting down quietly and absorbing things in a way that does not involve playing video games and killing people online.

It is really important that people with visual impairment, dyslexia or other medical conditions that require them to read in a different way are not excluded. I listened very carefully to the right hon. Gentleman, and there are real issues in trying to circumnavigate who is eligible for some kind of exemption. That is why in this case—in many other cases too, but especially this one—I plead with the Minister to make it a universal exemption. In other words, people should not have to prove that they cannot access books in any other way. The tax should be gone, because accessing literature is important for everyone.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

The hon. Lady is making a very important point that I probably did not express very well in my speech. Asking people to prove their disability may exclude a whole tranche of people. That sort of vetting would be so negative for so many people that they just would not do it. I agree completely that a general relaxation of VAT is the only way forward.

Photo of Marion Fellows Marion Fellows Scottish National Party, Motherwell and Wishaw

I totally agree, and the right hon. Gentleman expressed it much better than I was able to.

Reading has many mental health benefits, and there is a clear link between reading and improved wellbeing. Given that the cost of living crisis has led to soaring rates of stress, anxiety and depression, there are clear benefits to making audiobooks more affordable. Norway— I frequently refer to small, independent nations in other debates, although I do not do so on this occasion for any other reason—has scrapped VAT on audiobooks altogether.

The National Literacy Trust says that two in five audiobook listeners are children, and young people said that listening to an audiobook or podcast got them interested in reading books. Something that encourages children to read has to be good. Most children and young people who enjoy listening say that they also enjoy reading, compared with children who do not enjoy listening. Introducing children and young people to reading in a way that they find engaging and enjoyable is a vital means of improving literacy. I have grandchildren, and they love listening to stories on the BBC or through the fancy machine that I bought one of them for Christmas last year. It encourages them to think about books in a positive way. Many more children would benefit if there were no tax on audiobooks. Reducing VAT on audiobooks is essential to ensure that young people especially listen to books.

I want to ask the Minister a question—the RNIB asked me to ask her this, so I will. Has she evaluated the cost of extending the VAT exemption to those who are blind, partially sighted or have print disabilities? Has anything been done on that? As well as that question from the RNIB, I would like to ask a further question: how much would it cost to just remove the tax entirely?

I do not think I need to go on further because the right hon. Member for Hemel Hempstead covered this topic extremely effectively. I cannot find an argument against this, so I am going let the Opposition spokesperson speak and listen carefully to what the Minister has to say on this very important topic.

Photo of James Murray James Murray Shadow Financial Secretary (Treasury) 3:25, 15 June 2023

It is a pleasure to serve under you, Mr Sharma, my parliamentary neighbour in Ealing. I start by wholeheartedly congratulating Sir Mike Penning on securing the debate. I listened to him with great interest and I thought his speech was very thoughtful, heartfelt and informative. Indeed, in preparing for this debate, I found it informative to understand the nuance of the issues relating to audiobooks in greater detail. As well as thanking the right hon. Member, I thank several organisations that have campaigned for this change, including the Macular Society, the Society of Authors, and the Writers’ Guild of Great Britain, all of which have called for the exemption of audiobooks from VAT.

Before coming to the debate, I read an early-day motion that has been tabled as part of the campaign. I also found that informative in setting out the benefits of audiobooks for the many people with sight loss, visual impairment, dyslexia or other reading disabilities. The motion explains how audiobooks offer unique opportunities for visually impaired and dyslexic people to improve their education on a par with their peers. It recognises the role of audiobooks in enabling visually impaired and dyslexic people to continue working independently for longer and thereby contribute to the economy for longer. It explains how audiobooks open up a world of information, literature and poetry to visually impaired and dyslexic people. The attractions and benefits of audiobooks are clear, but there is the question of how much they cost.

Although this debate concerns VAT on audiobooks in particular, there is a wider context. Inflation and the high tax burden in our country affect people’s spending across the board. Before the debate, I also read that the application of VAT to printed publications dates right back to the introduction of VAT in 1973, when printed books, newspapers and magazines were given a zero rate.

Recent technological changes are raising questions over how the tax system across the board adjusts to a more digital world. That applies in many parts of our society and economy, and it raises questions about fairness, consistency and revenue raising. In response to technological changes, since 1 May 2020, the zero rate of VAT charged on printed books, newspapers and magazines has also been applied to e-publications. However, as we heard from the right hon. Member, the sale of audiobooks continues to be subject to the standard rate of 20%.

I will listen with interest to the Minister’s response, because the attractions and benefits of audiobooks are clear, and I am sure that she will recognise many of the points made about the importance of audiobooks for people with sight loss, visual impairment, dyslexia and other reading disabilities. The Opposition appreciate, however, that expanding the scope of VAT is complex and can add pressures to the public finances. I am sure that the Government will carefully consider this issue, and like other Members, I look forward to hearing the Minister’s response.

Photo of Victoria Atkins Victoria Atkins The Financial Secretary to the Treasury 3:29, 15 June 2023

It is a pleasure to serve under your chairmanship, Mr Sharma. I congratulate my right hon. Friend Sir Mike Penning on securing this debate, and I thank him sincerely for the personal experiences that he has brought into it.

For what it is worth, I did not know that my right hon. Friend has lived with dyslexia. I have seen him so many times in the Chamber, both at the Dispatch Box and as am eminent Back Bencher. I am genuinely in awe of his ability to memorise the briefs that we get. Anyone who has had to stand at the Dispatch Box, whether in Government or in Opposition, will know how densely written and complex they can be.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

The Minister and the civil servants who are listening will realise just how petrified officials were when I walked into my first ministerial position and said, “By the way, I memorise—I do not read—the submissions that you want me to read out at the Dispatch Box.” In a further seven Departments, the message not to try to push stuff in front of me eventually got round Westminster. It is interesting that we take for granted that people are reading verbatim what is in front of them. An awful lot of people with reading and learning difficulties do not. They actually go with their gut feeling, which is what I have always tended to do.

Photo of Victoria Atkins Victoria Atkins The Financial Secretary to the Treasury

My right hon. Friend makes an important point more generally, if I may have your munificence for a moment, Mr Sharma. It is so important that people such as my right hon. Friend show that dyslexia or other learning conditions need not be a barrier in a person’s ability to achieve success nowadays. In many ways, he will have been at the forefront of that change. I was horrified to hear about the reaction he had at school. I hope and trust that nowadays, children with a similar condition would not have that reaction; it would be much better understood. The fact that he rather endearingly described that he thought it was a tropical disease shows just how far we have come. He and others have been at the forefront of that, and I am genuinely grateful to him for sharing his experiences with us.

Ensuring that everybody is able to access books in all their forms is something that this Government take very seriously. Driving up standards in literacy has been our long-term priority in education, and our focus over the past decade has been on improving the teaching of reading for everybody. We have given students across the country a solid foundation in reading. That is not just to give young people the skills that are vital for their success in later life, but—as Marion Fellows put it so eloquently—to encourage a lifelong love and respect for one of life’s greatest pleasures.

I very much understand the enormous pleasures that audiobooks can bring, as someone whose constituency is quite some distance from London—I know the hon. Lady’s is, too. I have had an excitable seven, eight, nine, 10 and then 11-year-old throughout my career in this place, and having an audiobook that really grips a young child’s attention can be a godsend to parents struggling on long journeys.

I am veering into flippancy, but there is a much more serious point about what an audiobook can mean for an individual’s ability to read and enjoy reading. My right hon. Friend the Member for Hemel Hempstead gave the compelling example of his constituent who is losing her sight and with it, she fears, her ability to continue enjoying reading. I take that very seriously. I understand his point about the difference in timing and the implications of VAT.

We believe that a love of reading should be ignited at a young age, which is why we have committed to ensuring that early reading is taught well in schools. We have introduced packages of measures.

Photo of Christine Jardine Christine Jardine Liberal Democrat Spokesperson (Scotland), Liberal Democrat Spokesperson (Women and Equalities), Liberal Democrat Spokesperson (Cabinet Office)

The Minister is making a good point. In a previous life as a university lecturer in journalism, I had a student who was blind. The books that were available as audiobooks were much more expensive because of the VAT, and there were fewer of them. With podcasts, there is more material. The educational value is not just in schools, but goes right through to higher education. I had an elderly grandparent who went blind, but was still able to read through audiobooks, which became a lifeline. The VAT is an obstacle to providing a vital lifeline to elderly people who can no longer read.

Photo of Victoria Atkins Victoria Atkins The Financial Secretary to the Treasury

Although this part of my speech focuses on children, I very much accept the point about people having a love of reading throughout their life. I want to mention the positive work, which I hope is welcomed across the House, in schools to improve literacy and give that love of reading to young people. The English hubs programme promotes a love of reading and spreads best practice in teaching pupils to read. It supports schools in England in providing excellent phonics and early language teaching. The hon. Lady will be able to help us with what happens in Scotland. The ability to teach reading, particularly through the use of phonics, is very much recognised. Through the hub programme, literary specialists provide tailored support to schools, including by running events to showcase excellent practice in teaching and reading, and by working with local schools to develop their practice. So far, it has supported 1,600 schools intensively, and focuses on supporting the children who are making the slowest progress in reading, many of whom come from disadvantaged backgrounds.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

The work the Minister alludes to is on key stage 1 English. It is on the teaching of phonics. The hubs are brilliant—absolutely great—but they do not help dyslexic kids, or kids who are visually impaired, because it is a book-reading hub; it is not what they need. Nothing I have said today takes away from the fact that we want more people to have that wonderful experience of reading, but those who cannot are being excluded from those hubs.

Photo of Victoria Atkins Victoria Atkins The Financial Secretary to the Treasury

I hope my right hon. Friend will understand that this is not my area of expertise, and that I am here responding on VAT, but I will take away his observations on the hubs. Schools find their own ways of teaching their children. I recently had the pleasure of a Friday afternoon visit to a wonderful primary school in my constituency, Mareham Le Fen Primary School. They have “mystery reading”, where someone reads an extract of a book to the entire primary school to try to encourage pupils to finish that book. Schools across the country have programmes like that to encourage reading and to make it a real pleasure for children, and I very much support any efforts to bring that about.

We have provided £8.7 million of funding this academic year to support schools in purchasing complete systematic synthetic phonics programmes for their curriculum—that is a good example of Department for Education jargon. By ensuring high-quality phonics teaching and improving literacy, we are giving children a solid base on which to build as they progress through school. We published the reading framework in 2021. Over 90% of schools have read that framework, which provides guidance on how to improve the teaching of reading. It focuses on the early stages of teaching reading, and on the contribution of talk, stories and systematic synthetic phonics. It also helps schools to meet expectations for teaching early reading.

We very much appreciate the fact that these measures are paying off. England came fourth out of the 43 countries that tested children of the same age for primary reading proficiency in the Progress in International Reading Literacy Study, the results of which were published last month. That is a real success, and we know that it is down to the concentration on phonics and is driven by improvements for those pupils who have perhaps struggled in the past. I am very grateful, as I know my right hon. Friend the Member for Hemel Hempstead is, to ministerial colleagues whose efforts over the years have driven those changes.

However, we also recognise the importance of provision for children with special educational needs and disabilities, including children who live with some of the conditions that we have heard about today, including partial sightedness and blindness, dyslexia and other learning conditions. These cohorts may require extra support, so the next reading framework to be published will include guidance on supporting children who are struggling to read, including those with special educational needs. The Government speak regularly to experts, including SEND specialists, specialist schools and English hubs, about how we can support teachers to ensure that children with dyslexia and other learning difficulties can progress well in their reading, and meet the expectations on them by the time they leave primary school.

If I may, I will now turn to the subject of VAT. Of course, as colleagues from across the House know, VAT is a broad-based tax on consumption, and the 20% standard rate applies to most goods and services. Although there are exceptions to the standard rate, these have always been strictly limited by both legal and fiscal considerations.

We did indeed cut the VAT on certain digital publications in the March 2020 Budget to support literacy and reading in all its forms, and to make it clear that e-books, e-newspapers, e-magazines, and academic e-journals are entitled to the same VAT treatment as their physical counterparts.

The extension of the zero rate of VAT to e-publications was introduced to address the inconsistency of approach between certain physical publications and their digital counterparts, so that there is a mirroring between the two; if a publication in physical form has a zero rating, then in digital form it now has the same exemption. There will be categories of publication where, because the physical form does not have zero rating, the digital form does not either. I say that because audiobooks—and podcasts, which Christine Jardine mentioned—would not come under that approach, if one were to extend it to audio publications. We say that there is no such inconsistency in relation to audiobooks, but I appreciate that that is the point under discussion today.

As colleagues know, any VAT relief would come at a cost to the Exchequer, and it would be very difficult to target. The hon. Member for Motherwell and Wishaw said that the RNIB has asked if this approach has been costed, both for people living with sight conditions and the public more generally. My answer to her is that there is ongoing work on that. I do not have figures that I can give her today, because I need to satisfy myself that any figures I give are accurate, but I take her point, and I will write to her in due course, when I am in a position to do so, because that is a very fair question.

As was noted by James Murray, who spoke for the Opposition, there is a sense that the law has to try to keep pace with the speed of change in technology, which can be difficult; I think we all acknowledge that. For example, many audiobooks are now provided through subscription, along with other forms of media, such as podcasts, and trying to introduce distinctions between these different types of products would introduce additional complexity into the VAT system.

There is also no guarantee that the benefit of any VAT relief would be passed on to the consumer in the form of lower prices. That is quite an important point. We all assume that the VAT exemption announced in March 2020 was passed on to consumers by businesses, but it seems that that is not necessarily the case. It is not for me to advise either right hon. and hon. Members or charities, but where that benefit is not being passed on to consumers, perhaps publishers of e-books and so on should be asked why.

Audiobooks are enjoyed by a wide range of consumers, so the majority of any relief would primarily be felt by those not living with disabilities that prevent them from accessing physical and digital books. Also, I am obliged to mention, as in any debate on VAT, that it is the third largest tax in the UK in terms of yield, and it allows the Government and the state to provide public services. It is forecast to raise £161 billion this financial year alone. Many public services are supported from those funds, so we have to look very carefully at every request to change or tweak the VAT system, or to use it to meet the laudable aims and concerns of colleagues from across the House.

There was a question about the VAT cut. Some might say, “Hang on a minute; if the Government have imposed the VAT cut, why can’t they force businesses to pass on that cut?” We set the tax framework, and businesses must operate within it, but if a business chooses to absorb that tax relief as profit, rather than pass it on to consumers, that is a commercial decision taken by the business. That may be something that others outside this Chamber may wish to reflect on when considering the issue as a whole.

In conclusion, we understand why my right hon. Friend the Member for Hemel Hempstead called for this debate. We agree that literacy is a vital issue, not just for our youngest citizens but throughout our lifetimes. We are confident that our record over the past 13 years shows that we are making the right decisions for children in school. We believe that the measures that we continue to take to support reading are the best way to target our resources to deliver this wonderful benefit to everyone. However, we do not rest on our laurels; that is why the reading framework guidance will also focus on the needs of children living with special educational needs.

I thank my right hon. Friend for his debate, and I thank hon. Members from across the House for their contributions. I am sorry that I am not able to give quite the news that my right hon. Friend was hoping for, but I look forward to discussing the matter with him in future.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead 3:48, 15 June 2023

I thank the Minister for her restricted comments. I fully understand that she will not commit. To give her a little bit of help, the Publishers Association estimates that we are talking about £22 million a year going into the Exchequer. It may be wrong, and I accept that not everybody would pass on a VAT relief.

I should have done this earlier, but I thank the Library, the Publishers Association, the National Literacy Trust, the Macular Society, RNIB, Scope, Glaucoma UK, Sight Scotland, Sight Scotland Veterans and my former colleagues in the military, Listening Books, AbilityNet, Disability Rights UK and the Authors’ Licensing and Collecting Society. One tiny point: I think 57 colleagues signed my early-day motion. I look forward to further conversations with the Minister; we will be back. The Backbench Business Committee was generous to give me 90 minutes here. With those sorts of numbers supporting me, I might be on the Floor of the House with the Minister, perhaps in the autumn, when she might have nicer and more helpful comments for me.

Question put and agreed to.


That this House
has considered the matter of VAT on audiobooks.

Sitting adjourned.