Business
Why vinyl records like Taylor Swift’s ‘The Life of a Showgirl’ are protected from tariffs
Taylor Swift performs onstage during The Eras Tour at Wembley Stadium on June 21, 2024, in London.
Kevin Mazur | Getty Images
On Friday, 24-year-old Tayra McDaniels will scamper down the stairs of her East Village apartment building and pick up four preordered vinyl editions of Taylor Swift’s new album, “The Life of a Showgirl” — each a different color and with a different collectible cover. Then she’ll head over to Target to snag three more exclusive CDs and another vinyl, she said.
The haul will cost her more than $200. “I know it’s a lot of money,” she said. “But I don’t want to miss out.”
One point of reprieve in the price: McDaniels and other vinyl fans won’t have to worry about tariffs on their hauls.
Vinyl records, CDs and cassettes were spared from the Trump administration’s late-August rollback of the “de minimis” exemption. The exemption, which had allowed packages valued at less than $800 to be imported without tariffs, was designed to simplify customs for low-cost imports and reduce fees for both consumers and small retailers. Trump’s rollback of the exemption allowed tariffs to take effect on such shipments — but not on physical music.
A Cold War-era carveout known as the Berman Amendment to the International Emergency Economic Powers Act prevents presidents from regulating the flow of “informational materials,” a category that includes physical music, books and artwork.
“If vinyl had gotten tariffed, you could have possibly seen the price of a record going up to $40 and $50,” Berklee College of Music professor Ralph Jaccodine told CNBC. “So, this is welcome news for people buying physical music.”
The exemption, which is protecting one of the fastest-growing segments of the music industry, is also welcome on Wall Street.
Vinyl sales have roared back in the past decade, particularly during the pandemic, driven by younger buyers and an appetite for nostalgia. The PVC discs now account for nearly three-quarters of all U.S. physical music revenue — a nearly 20% jump since 2020, according to data from the Recording Industry Association of America.
“It is very encouraging and a bit of a relief that physical music formats have been classified as exempt to tariffs,” said Ryan Mitrovich, general manager of the Vinyl Alliance, a nonprofit promoting physical media that works with manufacturers, distributors and music labels. “However, we’re not really taking anything for granted here with the chaotic climate around trade disruptions.”
The sales boom has been lucrative for record labels such as Universal Music Group, or UMG, which works with Swift.
Her last album, “The Tortured Poets Department,” sold 3.49 million physical and digital copies, according to entertainment data company Luminate, driving a 9.6% jump in UMG’s second-quarter revenue in 2024 compared with the same period in 2023. Physical revenue, which includes vinyl, surged by 14.4% during the quarter.
Without a Swift album on shelves so far this year, UMG’s most recent earnings report, in July, showed a 4.5% uptick in revenue year over year, but physical revenue decreased by 12.4%. UMG shares fell 24% after the July earnings release.
Universal Music Group declined to comment.
The downturn could be short-lived. Estimates from Billboard predict that first-week vinyl sales of Swift’s new 12-track album, which debuts Friday, could top 1 million — breaking her own record of 859,000 for “The Tortured Poets Department.”
“Taylor Swift has unique ability to drive the market through her decisions of what and how to release music,” said Jaccodine, who has worked with artists such as Bruce Springsteen. “Swift’s release can and will likely cause a boom in the music business.”
Tariff trade-offs
Not everyone is celebrating the tariff exemptions. Some American record manufacturers say they’re missing out on business.
“We support the tariffs because it helps U.S. manufacturing, and we want to be a part of the wave of making things in the USA,” Alex Cushing, co-founder and president of Dallas-based Hand Drawn Records, told CNBC.
Most vinyl is pressed overseas, industry experts said, with the largest manufacturer, GZ Media, based in the Czech Republic. GZ CEO Michal Štěrba said the company has made top-selling albums for artists such as Lady Gaga, Madonna and U2. On average, the company produces 1 in 4 records from plants around the globe, including ones in Nashville and Memphis, Tennessee, he added.
“Our goal is to keep production as close to the customer as possible, so that a record sold in the U.S. is also made in the U.S.,” Štěrba told CNBC.
If tariffs were imposed, Štěrba said, costs would get passed on to consumers. The Czech Republic is part of the European Union, which faces a 15% blanket tariffs on EU exports to the U.S.
“By keeping tariff costs out of the supply chain — regardless of the product or country — consumers benefit through better pricing,” Štěrba said in a statement. “Ultimately, it’s usually the customer who has to pay a higher price if tariffs are applied.”
Cushing, a board member of the Vinyl Record Manufacturers Association, said he believes there would be more American jobs if tariffs were to apply to vinyl.
“We could put more hard-working Americans to work with good wages,” he said. “Our company makes 2 million records annually with a staff of just 60. If you want to grow manufacturing jobs, this would be a great industry.”
Cushing said U.S. manufacturers like his don’t have the capacity to handle the demand for an album on Swift’s scale. But for smaller-scale artists, he said, tariffs on imports could shift more business stateside.
“Our raw materials are tariffed, but with skyrocketing shipping and material costs globally, regional shipping in the U.S., coupled with having lower inventory, could help lower costs,” Cushing said.
Some American manufacturers preempted extra costs earlier this year.
“Tariffs were definitely forecasted, and the industry was preparing for this for quite a while,” Vinyl Alliance’s Mitrovich said. “We saw a lot of companies defend against this by increasing their stocks of ink, PVC and other things in the months leading up to the tariffs.”
A man browses through vinyl records.
SOPA Images | LightRocket | Getty Images
Artists’ earnings
For many artists, physical sales remain more lucrative than streaming.
On Spotify, earnings usually range between $0.003 and $0.005 per stream based on an artist’s contract with their record label, Jaccodine said. Meanwhile, artists typically enjoy between 10% and 25% of royalties on physical records, according to the American Society of Composers, Authors and Publishers.
“Unless you are just a handful of musicians, you basically are not making enough money from streaming to sustain,” Jaccodine said. “For artists large and small, merchandise like records, CDs, cassettes, hats, hoodies and ticket sales are the bread and butter.”
For comparison, Swift’s Eras Tour, which was the highest-grossing tour of all time, sold over $2 billion worth of tickets for 149 shows over two years, The New York Times reported. Meanwhile, she earned between $200 million and $400 million from streaming platforms over that same period, according to figures from Billboard.
Fans take photos with Taylor Swift’s new album “The Life of a Showgirl” at a Target store in New York City, U.S., Oct. 3, 2025.
Kylie Cooper | Reuters
Gen Z’s buying power
Analysts expect the vinyl market to keep expanding, though not at the explosive pace seen during the pandemic.
“The market for vinyl is strong and is likely to be for the foreseeable future, but there could always be supply troubles,” Jaccodine said.
Gen Z has fueled vinyl’s resurgence, industry experts said. Nearly 60% of 18- to 24-year-olds in a survey by music manufacturer Key Production said they listen to physical music, the highest of any demographic group. The survey was conducted Feb. 27-March 5, 2024, in the U.K., and had 503 respondents.
The vinyl comeback also kicked off an explosion in the number of “variants” released: collectible editions of albums or singles with alternative cover art, colored discs or vinyl-exclusive bonus tracks.
On TikTok, “vinyl hauls” rack up millions of views as fans show off rare variants and collections, sparking demand and motivating fans such as McDaniels to buy.
“It’s sort of like Pokémon where you ‘gotta catch ’em all,'” McDaniels said. “There’s FOMO [fear of missing out] if someone has a variant that you don’t.”
Experts said Gen Z’s interest in vinyl is also a response to digital burnout.
“So many groups are on their screens paying fees to have access to content but do not ever actually own anything, so this gives them physical ownership,” Cushing said. “Vinyl is counter to all the ease of modern music listening and that’s why people want it.”
No artist has capitalized on the trend more than Swift.
“The Tortured Poets Department” was 2024’s top album, accounting for over 6% of total album sales — more than seven times the next-best-selling artist, according to Luminate. Swift released 36 different album variants in the U.S. across digital and physical music.
“The Life of a Showgirl” comes in at least seven different variants of colored vinyl, each with a unique cover. For Swift and UMG, every exclusive edition of a vinyl record, CD or cassette has the potential to generate millions in extra revenue.
“Sales of Swift’s albums act as drivers for the fortunes of almost the entire music industry,” Jaccodine said. “Her fans are waiting with bated breath for the release, but so is the industry.”
For McDaniels and thousands of other superfans, the lingering question is how easy it will be to get the exclusive variants first.
“I know people think it’s crazy,” she said. “As long as a vinyl stays under $75 for a new release, I feel like it is worth it. It’s like an addiction to getting these, but I love collecting them.”
NEW DELHI: On the back of a fillip provided by a reduction in GST on 375 items, Indian consumers flocked to stores and car dealerships resulting in the highest Navratri sales in over a decade, govt officials said, citing industry data.They argued that the move lowered prices, helping families upgrade vehicles, buy white goods and spend more freely on lifestyle products, “turning festive cheer into record-breaking consumption”.GST rates for food items, daily-use products, white goods, cement and automobiles have been slashed as the Centre and the states agreed to reduce the number of slabs and end cess on all luxury and sin products, barring tobacco. Apart from making the indirect tax regime simpler, the idea was to boost consumption, even if it resulted in a temporary impact on tax collections.
Car sales vroom
“By rationalising GST slabs and easing the tax burden on both essential and aspirational items, govt fostered an environment of confident spending. As a result, brands and retailers reported sales growth ranging from 25% to 100%, marking a major boost for India’s consumption-driven economy,” an official said.
GST reset, pent-up demand driving sales over last 10 days
Although companies had complained about an adverse impact on sales after PM Narendra Modi first announced the plan for GST rate rationalisation in his Independence Day speech, collections in Sept – based on transactions in Aug – grew at over 9%, the fastest pace of growth in four months, according to the data released on Wednesday.While goods and services are more affordable, especially after govt nudged businesses to pass on the benefits to consumers, pent up demand is also a factor behind a surge in sales over the last 10 days.As a result, companies such as Maruti Suzuki, the country’s largest carmaker, reported 3.5 lakh bookings with nearly 2.5 lakh pending orders. By the end of Navratri, it was expected to deliver 2 lakh vehicles, 2.3 times last year’s level of 85,000 cars. Similarly, M&M has reported a 60% jump in its top selling XUV700 and Scorpio N sales, while demand for Hyundai’s Creta and Venue are also seen to be strong.In the consumer electronics space, companies and top retailers are reporting significant rise in sales.
Blue chips in London enjoyed another strong day on Friday, hitting a fresh peak, with a pick up in new listings adding to the more optimistic mood.
The FTSE 100 index closed up 63.52 points, 0.7%, at 9,491.25, a new closing high, and just shy of a fresh intra-day best level of 9,494.64 hit earlier in the trading day.
The FTSE 250 ended up 150.32 points, 0.7%, at 22,197.62, and the AIM All-Share advanced 7.57 points, 1.0%, at 796.52.
For the week, the FTSE 100 was up 2.2%, the FTSE 250 was 2.4% higher, while the AIM All-Share added 2.1%.
The upbeat mood came despite the ongoing US federal government shutdown and some downbeat domestic economic data.
AJ Bell investment director Russ Mould said: “There is growing expectation that the shutdown in Washington might continue until mid-October.
“How long investors remain relaxed about this state of affairs remains hard to predict, but one worry is that it makes it significantly harder for the Federal Reserve to make informed decisions around interest rates,” he added.
In the UK, speculation of tax hikes ahead of the Autumn budget was blamed for a slowdown in services sector activity in September.
The S&P Global UK services purchasing managers’ business activity index fell to 50.8 points in September from 54.2 in August, and missed the flash reading of 51.9 released late last month.
Tim Moore at S&P Global said: “Many survey respondents suggested that corporate clients had deferred spending decisions until after the Autumn budget, while households were also hesitant about major purchases.”
In better news for the “Square Mile”, consumer staples company Princes Group said it intends to float on the Main Market of the London Stock Exchange.
The Liverpool-based firm reported £2.1 billion in pro forma revenue in 2024, and pro forma adjusted earnings before interest, tax, depreciation and amortisation of £122.3 million.
Its portfolio includes Princes tuna, Branston, Flora, Napolina and own-brand products.
Chief executive Simon Harrison said: “Whilst we are renowned for our iconic Princes tuna, through a combination of organic growth and focused M&A, we have built an international £2 billion food and drink portfolio.”
In addition, Beauty Tech Group made its stock market debut in London.
The Cheshire-based seller of at-home beauty treatment technology, including laser devices and LED face masks through the brands Tria Laser, CurrentSkin and Ziip Beauty, closed at 288p per share, above the 271p initial public offer price in a successful first day’s trading.
Stocks in New York were higher at the time of the London close. The Dow Jones Industrial Average was up 0.8%, the S&P 500 index was 0.4% higher and the Nasdaq Composite 0.2% to the good.
In European equities on Friday, the CAC 40 in Paris closed up 0.2%, while the DAX 40 in Frankfurt fell 0.2%.
Amid the bullish market mood, Bank of America strategists said there is a risk that markets are “under-pricing the risk of weakening growth momentum”, and as well as “potentially over-pricing the support from productivity growth”.
As a result, BofA said it is positioned for macro data to “surprise to the downside relative to lofty expectations”, implying scope for widening risk premia and fading EPS expectations, consistent with “more than 10% downside for the Stoxx 600 and 10% underperformance for European cyclicals versus defensives”.
The pound was quoted higher at 1.3469 dollars at the time of the London equity market close on Friday, compared to 1.3415 dollars on Thursday. The euro stood at 1.1741 dollars, up against 1.1697 dollars. Against the yen, the dollar was trading at 147.43 yen, slightly higher compared to 147.37 yen.
The yield on the US 10-year Treasury was quoted unchanged at 4.11% from Thursday. The yield on the US 30-year Treasury stood at 4.70%, also flat from Thursday.
Broker recommendations drove a number of the leading risers on the FTSE 100.
Bunzl climbed 4.5%, as Goldman Sachs took the international distribution and services group off its “sell” list, moving to “neutral”.
While RBC Capital Markets double upgraded London-based supplier of specialised technical products and services Diploma to “outperform” from “underperform”, sending shares 2.3% higher.
RBC said Diploma’s track record in terms of organic growth, earnings before interest, tax and amortisation margins, cash conversion and, importantly, return on invested capital, “speaks for itself”.
The broker added: “The majority of financial metrics are at the top-end of the sector whilst the diversity of the business provides resilience through the cycle.”
Schroders closed up 3.7% as Citi upgraded to “buy” from “neutral” after recent underperformance that it called “somewhat surprising”.
The broker said the financial services provider has among the highest gearing to strongly-performing equities across its coverage, recent flow momentum appears strong, while it should also be “positively geared” to any improvement/recovery in private markets activity.
Meanwhile, Intertek advanced 2.6% as Bank of America restarted coverage with a “buy” rating.
Banks were a firm feature, with NatWest up 3.8%, Standard Chartered up 1.7%, Barclays up 1.4% and HSBC up 1.7%.
Elsewhere, JD Wetherspoon failed to cheer investors with shares down 5.6%, despite a strong rebound in profits and record sales, as analysts warned that rising wage and energy costs could crimp margins and stall momentum in the new financial year.
Audioboom stormed 18% higher after Sky News said it is working with advisers to explore terms of a potential takeover of the company.
New York City-based Fox Corp and San Antonio, Texas-based iHeartMedia could be potential bidders for the London-based podcast producer of Formula One motor racing’s official podcast, according to media analysts.
Brent oil traded at 64.61 dollars a barrel on Friday, up from 64.42 dollars late on Thursday.
Gold soared once more, trading at 3,885.67 dollars an ounce on Friday, up against 3,830.85 dollars on Thursday.
The biggest risers on the FTSE 100 were Bunzl, up 106p at 2,490p; NatWest, up 20.2p at 548p; Schroders, up 14.2p at 393.8p; Spirax, up 195p at 7,290p; and 3i Group, up 116p at 4,426p.
The biggest fallers on the FTSE 100 were Coca-Cola Europacific Partners, down 130p at 6,450p; Admiral, down 64p at 3,268p; Coca-Cola HBC, down 56p at 3,306p; Airtel Africa, down 3p at 239p; and GSK, down 18.5p at 1,628.5p.
Monday’s global economic calendar has eurozone retail sales figures and construction PMI readings in the eurozone and the UK.
Monday’s UK corporate calendar has a trading statement from Ferrexpo, the Swiss-headquartered iron ore company with assets in Ukraine.
Contributed by Alliance News.
The governor of the Bank of England has cautioned over the risks of removing financial regulation in a bid to drive to growth, amid efforts by the Chancellor to scrap red tape.
Andrew Bailey said in a speech in Amsterdam that he can see evidence there is a “risk of history showing signs of repeating itself” amid calls for deregulation as memories fade regarding the financial crisis.
He stressed there is “no trade-off” between financial stability and ambitions for stronger growth and competitiveness.
“If the baby is thrown out with the bath water so to speak, and financial stability is relegated in terms of its importance, we won’t achieve our objectives,” he said.
The message, at an event hosted by the Dutch central bank, comes as Chancellor Rachel Reeves continues to push forward with plans to scale back regulation.
In July, Ms Reeves launched the “Leeds Reforms” package of changes to the financial services industry to pull back restrictions and encourage more financial risk-taking in a hope it could drive economic growth.
A week later, Mr Bailey warned against tearing up post-financial crisis ring-fencing rules on banks, stressing a need to protect consumers.
Shortly afterwards, he also reportedly blocked a meeting planned by Ms Reeves to address the regulation of Revolut, due to concerns of political interference in the central bank’s oversight process.
On Friday, Mr Bailey highlighted a theory by economist Hyman Minsky that “as time passes, memories of a financial crisis fade and this leads to a questioning of the continuing need for the responses”.
He added: “This creates the risk of history showing signs of repeating itself, remembering back for instance to the strength of the deregulation argument before the financial crisis.”
The governor also told the audience he “pushes back” against arguments that post-crisis regulation caused the fall in productivity growth and weaker investment in the years since.
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