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After a couple of decades in which the British film industry was in the news more for concerns about its health and productivity than sustained on-screen success, it could be said that it is currently quite robust.
Earlier this year, the British Film Institute (BFI) revealed that 2018 had seen a record number of cinema admissions and was also one of the biggest years for investment in film production and quality television drama.
The Government was, of course, quick to seize upon those figures as evidence of its support for a range of domestic creative industries.
Among the key elements which ministers pointed to was the introduction of a series of tax reliefs, the first of which came into being in 2007.
As my colleague Thomas Slipanczewski outlined in a factsheet on the reliefs only a few weeks ago, they are open to productions which pass something delicately described as “a cultural test” and spend at least 10 per cent of their production costs in the UK.
To give you some idea of the scale of return, figures issued by HMRC in August set out how claims related to some 705 films made either entirely or in part in Britain had generated £595 million in relief during the course of the last financial year.
Claims by film productions, in fact, took up more than half the total value (£1.1 billion) of all the creative industry tax reliefs handed out during the period.
You might assume, therefore, that producers would be cock-a-hoop and eager to have yet more projects given the green light by backers and the taxman yet that’s not the case.
In recent days, news reports have suggested that some of the country’s leading producers have claimed that the reliefs are not as generous as they should be and don’t necessarily benefit those individuals who invest time, effort and creative energy in bringing great ideas to the big screen.
One award-winning producer, Michael Winterbottom, has even spoken of the film tax relief representing something of a “betrayal” which is exploited more by financiers to profit from their involvement with productions than producers themselves.
His comments echo unease rumbling within the British industry since 2017, when the body representing producers – the Producers Alliance for Cinema and Television, or PACT, for short – proposed increasing the amount of relief available to small budget domestic films.
One can well imagine politicians and Treasury officials archly raising an eyebrow in the manner of the stars of the silent movie era at the thought of extending already generous support still further. Over at the Revenue, there might be even more pointed interest, given recent controversies associated with multi-million avoidance schemes linked to the generation of artificial losses.
Even the most ardent advocates of the domestic movie business understand that the debate hangs on the kind of dramatic tension which is an essential ingredient in the kind of story which puts audience bums on seats.
It’s something which is all too obvious to Adrian Wootton, the CEO of the British Film Commission.
“We need to be very careful“, he has recently warned, “we are not in danger of appearing to be overzealous or mercenary. Frankly, no British film would be made without the tax credit. Without the tax credit existing, we wouldn’t have a film industry“.
I reckon that it makes good sense to review any and all reliefs to ensure that they remain relevant, in much the same way as tax law is updated.
At a time when the prospect of hard Brexits and the possibility of hard times remain, however, persuading those in charge of the public sector purse strings to cough up even more cash has the makings of a real cliffhanger and one which, for film-makers, might well have an unhappy ending.
If you have any queries around film tax relief, or tax relief for creative industries in general, then please do get in touch.
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