Audiogest defends deductions from music streaming expenses in IRS

A possibility of VAT standardization in management committees is the third proposal of the memorandum sent to the Government by Audiogest – Association for the Management and Distribution of Rights, in a set of measures that “look to strengthen the paid digital music market, encourage the licensing of copyright and related rights by companies and resolve a difference in tax treatment between collective management entities”, according to the statement released today.

The first proposal provides that consumers – households and natural contributors – “may deduct 20% of the costs of subscriptions to musical streaming, excluding VAT, in IRS up to a maximum of EUR 100 deduction”.

The aim of this proposal, according to Audiogest, “is to encourage the passage of free services, financed by advertising, for paid subscriptions, which generate greater remuneration for authors, artists and producers”.

According to the audiogest, “the economic studies accompanying the proposal” show that these remunerations can be up to five times higher, also generating “a positive overall tax impact”.

Audiogest recalls that this measure had already been “proposed by the PSD Parliamentary Group” and endorsed by current Minister of State and Finance, Miranda Sarmento, as a deputy, for the 2024 budget, being “incomprehensiblely” rejected in the 2025 and 2026 budgets of the current government.

The second proposal, signed together with the Association of Hospitality, Restoration and Similarities of Portugal (AHRESP), is addressed to companies that license copyright and related rights for the use of works and services in their activity, as happens in bars and restaurants, among other entities, and provides that these expenses may be deductible for the purposes of IRC, in “120% of the costs incurred by such licensing”.

According to Audiogest, “this incentive would directly benefit companies using protected content, including radios and restaurants.”.

The association also states that “it does not make sense that tax incentives are applied only to the licensing of industrial property rights, such as trademarks and patents and computer programs, and that copyright and related rights of equal nature, economic relevance and higher constitutional protection, are excluded from any benefit.”.

The third and final proposal of Audiogest aims at “the standardization of the VAT treatment of management committees of collective management entities”.

According to the memorandum sent to the Government by Audiogest, “different tax interpretations applied to entities of the same nature create inequalities and hinder the creation of joint licensing counters”, imposing “a solution applicable to the whole sector”.

Audiogest seeks that the future “State Budget for 2027 includes concrete measures to increase the remuneration generated by music, support companies that use it legally and bring greater coherence and justice to the fiscal environment of the sector”.

Audiogest manages the collective rights of phonographic producers, also representing through Audiogest – Association for the Promotion of Music, the rights and interests of the Music Edition Industry in Portugal.

The association represents national and foreign phonographic producers in Portugal, from the individual projects of self-edited artists to the multinationals of the edition.