Brussels-based pan-European independent labels body Impala has launched a radical 10-point financial action plan for the music industry.

"This is a call for action to national governments, the EC and the music industry," Helen Smith, executive chair of IMPALA, tells

According to Smith, the plan has already met with positive feedback from several members of the European Commission (EC) and will be sent to European national governments, EC representatives and music industry execs following today's publication at MIDEM (Jan. 26).

The Impala proposals include a set system of compensation fees to be paid to small or independent labels who develop artists later signed by majors, plus revenue-sharing mechanisms throughout the industry.

Taking its inspiration from the sports industries, and particularly European soccer, where a percentage of revenue from top-earning teams is fed back into the lower leagues, the plan proposes the introduction of a 5% compensation fee on all future revenues of artists developed at a smaller label and later signed by a major.

Other proposals contained within the 10-point financial plan include:

The introduction of new international accounting standards which would allow proper valuation of copyright as an intangible asset.

€1.5 billion ($2.4 billion) European Union investment for culture per annum alongside a reworking of funds to ensure that small and medium-sized music enterprises directly benefit.

The creation of a "virtual creative industries bank" utilizing EIB (European Investment Bank) funds, specifically for the cultural industries.

Reducing VAT (sales tax) for cultural product sold online to zero throughout Europe.

Greater provisions for small and medium-sized music enterprises throughout European countries to get finance loans guaranteed.

Opening up existing EC research and development funds and other tax schemes to music and cultural industries, as well as adopting specific fiscal incentives such as music tax credits.

Creating a pan-European advisory group to bridge the gap between investors and cultural businesses in terms of communication and expertise.

EC intervention to resolve issues surrounding "double taxation" (where income is taxed both in the taxpayer's country of residence and in the country where the income is generated) and "withholding tax" (a tax on dividends and interest sent abroad to non-residents).

"The overall message for governments and the EC is that we know the cultural sector in general is under-capitalized and is not very well understood by governments and the finance sector But there are schemes that exist already and with a little bit of tweaking, both at EC and national level, then we could actually unlock already existing funds and channel them into the cultural sector," Smith adds.

Asked what reaction she hopes the financial plan would provoke in the music biz, Smith concedes that some measures, such as major labels paying compensation to smaller labels for developing talent,"might initially cause one or two raised eyebrows," but reiterates her belief in the proposed model and its long term benefits for the industry.

"As an industry [we] invest in talent," she says. "We tend to forget that sometimes and just think about what we sell. If you look at other sectors which are very similar to ours, like football, it's perfectly accepted by all those in the industry that the smaller players' contribution to developing talent is specifically rewarded -- and that they also need to be compensated to address the big gap between the small and the big clubs."