Calgary Herald

Tax hike threatens France’s book shops

- MYRIAM CHAPLAIN-RIOU

France’s small bookstores have survived the rise of big chains, Amazon and digital books, but many fear a sales tax increase, part of the debt-saddled government’s austerity plans, could push them out of business.

Until now, the thousands of independen­t bookseller­s that dot France’s town centres offered the best of both worlds — a quaint setting, one-onone tips and advice, and guaranteed prices as low as at chain stores.

Since 1981, the French state has set the price of books, largely to support independen­t bookstores that are seen as vital assets to local communitie­s.

But President Nicolas Sarkozy’s right-wing government, fighting to get public finances under control, has hiked the sales tax on books to seven per cent from 5.5 per cent.

With the French presidenti­al campaign in full swing before the April 22 first round, the question has turned political with Sarkozy’s Socialist rival, Francois Hollande, vowing to repeal the hike.

Bookseller­s see the tax increase, part of measures aimed at saving a total of 72 billion euros ($95 billion US), as a stab in the back.

The government has “loaded the bullet designed to kill off independen­t bookseller­s,” charged Vincent Monade, a former bookseller and head of the Paris region’s Observator­y for Books and Writing (MOTIF).

Unlike the U.S. for instance, where booksellin­g has become the preserve of big business, France has one of the densest networks of small bookstores in the world.

Guillaume Husson, the head of the SLF bookseller­s union, said the VAT announceme­nt was a “shock” to bookseller­s, already hurting from the rise of online vendors, soaring property rents and, now, digital books.

“It’s taking a big risk, for what amounts to a drop of water in the state coffers given the size of the national debt,” which stood at almost 1.7 trillion euros at the end of the third quarter of 2011.

On that scale, says the SLF, the sums generated by the extra book tax, estimated at $78 million at most, are a drop in the ocean — and yet the effect for bookstores could be disastrous.

Across the French book sector, the average profit margin is 0.3 per cent of turnover, according to a May 2011 study by the SLF and the culture ministry.

Given the millions of titles bookseller­s already have in stock, the SLF fears the VAT rise will eat into their wafer-thin profit margins and push many out of business.

The culture ministry has admitted France’s bookstores are in crisis but, says Renny Aupetit, a bookseller from eastern Paris, it “was overruled by a coup d’etat from the finance ministry.”

 ?? Miguel Medina, Afp-getty Images ?? Pedestrian­s walk by closed second-hand book stalls in Paris, where book shops are threatened by a tax hike.
Miguel Medina, Afp-getty Images Pedestrian­s walk by closed second-hand book stalls in Paris, where book shops are threatened by a tax hike.

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