"Salaries are already lower in small, provincial newspapers than in large newspapers. It would have been appropriate to at least postpone the increase to the end of the term of government."
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MARES AX3 now price 999 (norm. Suninen expects periodicals to cope with the change better. "The gain is marginal. Economic expert Arto Suninen says that a rise in subscription prices will inevitably lead to lower circulation figures. He thinks it is clear that the reform would change the structure of the media field and undermine the role of the press as
The reader picks up the tab The tax increase will be paid by readers, as publishers are likely to transfer the costs to subscription prices. Håkan Gabrielsson, acting director at the Finnish Newspapers Association, asks whether the tax proposal is a sign of deterioration of the respect for a pluralistic press. According to Niiranen, the effects of the change have not been assessed at all. The Ministry of Finance has proposed that a value added tax of nine per cent be charged on subscriptions to newspapers and periodicals from the beginning of next year, in accordance with the Government Programme. "The combined circulation of newspapers and periodicals may decrease by ten per cent, which means
a corresponding decrease in advertisement revenue. 1099)
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Bring this advert and get a 10% discount on our website prices. Currently, subscriptions are exempt from value added tax, whereas a tax of 23 per cent is paid on single-copy sales. There is pressure to increase prices as it is, due to the rise in costs such as the price of paper. "In a European context, Finland would become a country of high press taxation," he says. They have been flexible in order for the newspaper to survive. "If everything is assumed to go on as before, there is something wrong with the basic assumption."
THE MEDIA
industry is dismayed at the suggestion to increase value added tax for newspapers and periodicals. The media industry believes that the increase will lead to a loss of jobs and publication closures. The tax increase comes at an especially bad time because of the economic crisis. However, effects will differ between publications", says Valtteri Niiranen, Managing Director at the Federation of the Finnish Media Industry. This is an extra hit in the battle for survival for these newspapers," he says. For parts of the press this means hard times. Niiranen estimates that up to 3,000 media industry jobs may be at stake. HELSINKI TIMES
DOMESTIC NEWS
HEL SINKI TIMES
1 7 SEPTEMBER 2011
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Plurality of the press is an important democratic principle that will be weakened by the rise in VAT.
Value added tax threatens newspapers
Tax increase on subscriptions comes at a very bad time, expert says.
ILONA VIHONEN S T T
a communicator of news. According to Suninen, the public gain of value added tax may prove smaller than the costs caused by increased unemployment
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