BACKBENCH BUSINESS

Debate between Mike Penning and Marion Fellows

Thursday 15th June 2023 Westminster Hall

[Sir Mike Penning (Hemel Hempstead) (Con)]

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.

[Marion Fellows (Motherwell and Wishaw) (SNP)]

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?

[Sir Mike Penning]

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 the hon. Member for Motherwell and Wishaw (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.

[Marion Fellows (Motherwell and Wishaw) (SNP)]

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. The right hon. Member for Hemel Hempstead (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.

[Sir Mike Penning]

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.

[Marion Fellows]

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.