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Posted 04/10/2023

Understanding artist booking: Tax inclusive vs. Tax exclusive

Understanding Artist Booking: Tax Inclusive vs. Tax Exclusive

When planning an event and considering booking an artist, one crucial aspect that organizers must understand is the financial terminology—specifically, the difference between "Tax Inclusive" and "Tax Exclusive" when it comes to pricing. This distinction can greatly influence the total cost and the planning budget.

1. Defining the Terms: What are Tax Inclusive and Tax Exclusive?

Tax Inclusive: This means that the price quoted for booking an artist already includes any applicable taxes. In other words, if an artist’s fee is quoted as $1000 tax inclusive, then you will pay precisely $1000.

Tax Exclusive: On the other hand, if the price is tax exclusive, it means the quoted fee does not include tax. If an artist’s fee is quoted as $1000 tax exclusive and there's a 10% tax rate, then the total cost would be $1100.

2. The Tax Situation in France

In France, like many countries, a value-added tax (VAT) is applied to goods and services, including artist bookings. This tax supports public services and is levied on the consumer. If you're hosting an event in France, it's essential to understand whether the artist's price includes this tax or not to avoid budgeting surprises.

3. Taxes for Customers Outside of France

For customers booking an artist outside of France but within the European Union, things can get a bit complex. The general rule is that VAT is applied based on where the service (in this case, the performance) is provided. However, there are exceptions and intricate details that can vary based on the specific circumstances and countries involved.

If the event is outside the European Union, it's generally the responsibility of the event organizer to understand and manage the local tax implications in that country.

4. European Events: The Intricacies of VAT

When the event is within Europe but outside of France, VAT becomes a nuanced topic. The European Union has rules in place to ensure that services are taxed in the location they are consumed, meaning where the event takes place. However, it's crucial to liaise with local tax authorities or financial advisors to understand the specific VAT obligations in the hosting country. Moreover, some countries might have reciprocal tax agreements with France, which could affect the final VAT obligations.

Conclusion: The Importance of Clarity

Understanding the tax implications when booking an artist is crucial to ensure smooth financial planning and execution of your event. When negotiating with artists or their representatives, always seek clarity on whether the quoted price is tax inclusive or exclusive. If in doubt, especially for events within Europe, it's a good idea to consult with a financial expert familiar with European tax laws. This proactive approach can save time, money, and prevent any unforeseen tax complications.

Anyway, when you are not sure, it is always better to ask your entertainment agency and it will have the answer to your question.

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