U.K. to Offer "More Generous" Film, TV Production Incentives
The finance minister in his budget speech confirms a live-action kids tax credit, mentions an expansion of support for the video games sector and says "Britain is a cultural center of the world."
The British government on Wednesday presented its annual budget, with the entertainment industry paying close attention to updates on incentives schemes.
George Osborne, Britain's chancellor of the exchequer — the U.K. equivalent of other countries' treasury secretary or finance minister — gave his budget speech in front of parliament's House of Commons before the full budget was published.
Osborne cited the need to support growing and insurgent industries in his speech. "So we take steps to put Britain at the forefront of the online sharing economy. Our creative industries are already a great contributor to the British economy," he said. "We back them again today. We make our TV and film tax credits more generous, we expand our support for the video games industry and we launch our new tax credit for orchestras."
Said Osborne: "Britain is a cultural center of the world, and with these tax changes, I am determined we will stay that way."
The budget itself later showed that the film tax relief will increase to "25 percent for all qualifying core expenditure, for all eligible film productions." It added that "the distinction between limited budget films and all others will be removed." Subject to state aid approval by the European Commission, the changes will take effect on or after April 1 or the date of state aid approval, whichever is the later date.
So far, tax credits were available at 25 percent on the first $32.7 million (20 million pounds) of qualifying production expenditures and 20 percent thereafter for both small- and large-budget films.
The government also announced that it would reduce the minimum U.K. expenditure requirement for TV and animation productions from 25 percent to 10 percent, in line with films.
In his fall budget statement, Osborne had described live-action kids TV as "one area of television production that has been in decline." Back then, he also said that a planned "new children's television credit" would sit "alongside our new animation credit," which was previously implemented. The new kids incentive was part of the budget on Wednesday.
It said the "new children’s television tax relief" would launch in April and it would "include children's programs that are game shows or competitions."
Last year, Anne Wood, the creator of Teletubbies, which became one of the U.K.'s most successful children's TV shows after in the late 1990s the government said the kids TV industry has been "struggling for many, many years."
A spokesperson for the British Film Institute said the new budget offered "yet further evidence that the tax reliefs are working for the creative sector."
Speaking before the budget, Caroline Norbury, CEO of Creative England, said that 2014 had been record-breaking for the creative sector, which was growing faster than any other industry sector.
"Thanks to a winning combination of attractive tax incentives and world-class creative talent, film production brought an incredible £1.23 billion to the U.K. economy. These incentives mean we are able to compete on a global scale. It's no accident that Disney chose to film its biggest blockbusters of 2015 in England," she said.
The annual budget speech drew wide news coverage in Britain. This budget attracted particular attention, as it is the last of the government led by David Cameron before an election in May.
Osborne also mentioned plans to boost super fast Internet coverage in the U.K. and intends to improve mobile phone networks and Wi-Fi coverage.
"Britain is walking tall again," Osborne said in his speech Wednesday, highlighting that the U.K.'s economic growth last year outperformed all other advanced economies. Five years ago, the country suffered from an economic collapse, he said. "Living standards were set back by years by the great recession," Osborne said. "This is a budget that takes Britain one more big step on the road from austerity to prosperity."