British Government to Introduce Tax Credits For Million Dollar-Plus Budgeted TV Shows
LONDON – Disney and HBO were both name-checked as two major companies the British government hopes to lure to U.K. shores to shoot high-end television shows with the introduction of a tax credit.
The Chancellor of the Exchequer George Osborne, delivering his annual budget speech, said the government aims to bring in a tax credit to cover video games, animation and high-end TV program production.
The aim would be to stop British TV programs such Birdsong, starring Eddie Redmayne, Matthew Goode and Clemence Poesy and backed by NBCUniversal and Working Title TV from shooting abroad.
Osborne said the tax credit for TV and video would help keep such shoots in Britain and “also attract top international investors like Disney and HBO to make more of their premium shows in the U.K.”
It will likely mirror the U.K.’s current film tax credit system in place to the end of 2015 which allow producers to obtain a tax credit of 20 percent of expenditure incurred here in the U.K. up to a maximum of 80 percent of the production budget.
Osborne noted the movie tax system “helped generate over £1 billion ($1.58 billion) of film production investment in the U.K. last year alone.”
Unsurprisingly Osborne’s confirmation of the plans to extend the credit system to high end TV (HR 0/16/12) got a warm reception from a slew of big name producers here.
TV Coalition, which comprises some of the biggest names in U.K. and international TV production, gave it a thumbs up.
It could put an end to the exodus from the U.K. of dramas telling a British story, the TV Coalition said, citing shows such as Strike Back, The Tudors, Camelot, Parade’s End and the Julian Fellowes’ drama Titanic, as examples of productions made abroad in countries including South Africa and Canada in the last year.
The lobby group, advised by legal eagles Wiggin and accountnts RSM Tenon, estimates that a targeted tax credit in the U.K., similar to that received by the film industry, would generate at least £350 million ($555 million) per year as a result of high-budget scripted production relocating to the U.K..
Left Bank Pictures CEO Andy Harries, whose TV resume boasts Wallander starring Kenneth Branagh, said: "The proposed changes in the U.K. tax laws regarding television would give the British TV industry a much needed shot in the arm. British production talent is responsible for some of the best television in the world and at the moment many productions, which could very easily be shot in the U.K., are being made abroad and many talented creatives are moving elsewhere.”
He cited his own company Left Bank Pictures which is currently shooting two productions in South Africa – Mad Dogs and Strike Back – because tax breaks boosted the bang for its buck.
“The proposed changes will also welcome productions from around the world to U.K. shores and quite apart from the revenue that this will bring to our shores it will also help support the creative community in the U.K. and help train the next generation of film and TV makers,” Harries said.
Kudos Film and TV chairman Stephen Garrett, with the original British verision of Life on Mars and Law and Order: U.K. among the titles against his name described the move as “fantastic news.”
Said Garrett: “There is a huge demand for good quality television dramas around the world. In the U.K., we have a brilliant track record of coming up with the ideas and talent to produce them and now we have the critical piece of the jigsaw to ensure they are made over here.”
And Stewart Till, a former studio chief and co-CEO of U.S. based RHI Entertainment said Osborne’s move “is a game-changer” adding it “will have a fundamental effect on where we base our multi-million dollar productions in the future.”
HBO exec vp business and legal affairs Glenn Whitehead said: “The U.K. is one of the best places in the world to film as it has highly skilled people and exactly the right infrastructure to make great television. Today’s news on a new tax incentive has turned the U.K. from one of the most expensive options into a competitive and affordable location. We would therefore love to bring more production to the U.K.”
HBO based the shoot for Game of Thrones in Northern Ireland, where grant funding was made available.
“Our investment, which totals tens of millions of pounds, has had a major impact on job creation and long term infrastructure, benefiting that economy hugely,” Whitehead noted.
RSM Tenon’s Stephen Bristow said: “A number of U.K. production companies and inward investors have already made clear they would look to film in the U.K. should a tax credit be introduced so it could have a transformative effect and make the U.K. the world’s most attractive destination for high-end TV production.”
And Wiggin partner Charles Moore added that the tax incentive should be straightforward to introduce “as it can be structured in the same way as the existing film tax credit which has proved to be an effective and efficient mechanism.”
Pinewood Shepperton chief executive Ivan Dunleavy, who runs the studio facility empire floated on the stock exchange, said the move is further evidence of the Government's measured support for the creative industries.
“Pinewood identified this as a growth area back in 2009 in its evidence to the House of Lords Communications Select Committee when it investigated the British film and television industries. This decision builds on the success of the film tax incentive which has helped deliver record levels of inward investment in the U.K.”