A hammer blow to the UK’s hugely successful high-end TV (HETV) tax credit could be struck in next week’s budget and a prominent politician has written to the Chancellor urging him to reconsider.
Baroness Tina Stowell, who runs the influential House of Lords Communications and Digital Committee, wrote to Treasury boss Jeremy Hunt yesterday with a strongly-worded call to ignore requests to raise the threshold of the relief from shows that cost £1M ($1.2M) per hour to those costing £1.5M ($1.8M) per hour and above.
This is the recommendation made by a recent government report, which said that “rising production costs have meant that several productions which the government expects would have been commissioned regardless of the existence of HETV tax relief have become eligible.”
Stowell’s letter to Hunt came a day after British networks, Netflix, Paramount and indie trade body Pact wrote to her asking for her help in protecting the threshold. They said the changes will lead to fewer British dramas, comedies and documentaries being produced in the UK, along with a reduction in UK content exports. The Office exec Ash Atalla recently told The Times it will become “almost impossible” to make these shows if the government enacts the proposal.
Stowell’s letter urged Hunt to reconsider ahead of the March 15 budget. “We remain concerned that the importance of tax reliefs for the audio-visual sector is not sufficiently well recognized by the government,” wrote Stowell. “Much of the [creative] sector’s growth potential is in areas that combine technology with creativity, such as HETV production.”
As it currently stands, the UK’s HETV tax credit gifts up to 25% of UK qualifying expenditure for all shows made for £1M ($1.2M) per hour and above.
Hunt’s budget, which will be his second since taking on the post, is likely to contain news about tax reliefs, according to several reports from earlier this week.
Having launched around a decade ago, the UK’s HETV tax credit has been hugely successful, turning the nation into a filming hub and favored territory for streamer shows. Many similar rebates have since popped up across the globe.
The UK government is also considering merging the HETV credit with film, animation and children’s tax relief measures into one single credit.
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