The future of music

UK creative industries challenge the impacts of AI tax breaks on the arts

November 26, 2023
AI Authors

Key takeaways

  • A recent roundtable discussion in the UK debated issues relating to AI and music, art, journalism, writing, and other creative industries.
  • Among the topics discussed was the risk of giving out too many tax incentives for AI investment.
  • Specifically, why would companies bother hiring genuine creative talent when they pay virtually nil tax on replacing them with AI?

Culture Secretary Lucy Frazer recently met with leaders from the UK’s creative industries, including the film, publishing, and music sectors.

One of the many topics on the agenda was concerns that AI might soon prove more cost-effective than human labor, particularly in creative fields. This came ahead of UK Chancellor Jeremy Hunt’s Autumn Budget, which unveiled an economic policy named the “full expensing” tax break. 

In short, this tax break enables businesses to deduct expenses related to certain technology investments, including those related to AI.

Following the discussion, Nicola Solomon, CEO of the Society of Authors, highlighted the rising cost differences in employing humans versus machines. 

She stated, “If you buy in large amounts of machinery or software you will get capital allowances for that. If you take on real people, you have to pay their tax, their National Insurance and so on. So it actually becomes cheaper to buy and use machinery than to buy and use people, even if the base costs were the same.”

If companies pay virtually nil tax to replace humans, then who will be the first to go?

We already have AI pop stars signing record deals, for example. They’re inarguably cheaper and easier to manage than humans, but what is the cultural cost?

Earlier in the year, Damon Albarn from Blur and Gorillaz candidly said of AI, “If the AIs are the future of music, we’re gonna need better drugs to get us through it.”

“If the AIs are the future of music, we’re gonna need better drugs to get us through it.”

Damon Albarn

Themes from the roundtable

The roundtable discussion created a slew of resistance, including from the Council of Music Makers, who said it was biased in favor of leading record labels. 

The debate extended into the realm of copyright within AI. AI models are trained on vast quantities of human data, often without permission from the original creators. 

Ed Newton-Rex, a senior executive at Stability AI, recently resigned over the exploitation of people’s creative work by AI companies.

He said, “I’ve resigned from my role leading the Audio team at Stability AI because I don’t agree with the company’s opinion that training generative AI models on copyrighted works is ‘fair use.’”

The future is one where AIs and machines might not only play instruments and sing but also play a pivotal role in the industry’s economic dynamics. 

With so many incentives flying around for companies to invest in AI, governments must ensure they support humans, too. That includes both their jobs and copyrighted work.

Sam Jeans

Writer and digital artist who has been covering the latest AI-related news, including generative AI and its influence on the creative industries. Sam plays drums and has been writing for tech and music sites since 2016.

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