UK Screen Alliance and Animation UK propose 25% tax relief increase to better compete in an international market and incentivize industries to remain in the U.K.
UK Screen Alliance and Animation UK. shared an announcement made by the Chancellor of the Exchequer in the Autumn Statement of a consultation on reforming the screen sector tax reliefs. The government will consult on a series of proposals that will go further to incentivize the production of culturally British content and support the growth of the audio-visual sectors to continue to thrive in the U.K.
UK Screen Alliance and Animation UK have been campaigning for reform of the tax reliefs for several years and have proposed that the rate of relief should be increased above 25%, to reflect the higher rates of incentive available in competitor countries.
Animation UK has provided evidence to illustrate how the lack of a competitive rate of relief in the U.K. is allowing hundreds of millions of pounds of production to be taken out of the U.K. to receive better incentives. While the Chancellor was speaking, the “State of the Animation Nation” panel at the Manchester Animation Festival was emphasizing this point, as the news of the consultation was breaking.
Kate O’Connor, executive chair of Animation UK said, “The Animation industry has an international reputation for creative and technical excellence. We operate globally in an industry worth an estimated $2.5 bn. With the right investment, support for IP retention, and more competitive tax relief we can support growth, create jobs, and gain an increased market share. Our competitors have significantly increased their tax relief and investment. Quite simply, despite our excellence, we are not competing on a level playing field and we look forward to the opportunity to feed into this important consultation.”
The government has acknowledged that there is a perception that the 80% cap on qualifying expenditure encourages the more portable aspects of production, such as visual effects (VFX), to move abroad and will consult on the removal of the cap.
Neil Hatton, CEO of UK Screen Alliance said, “The 80% cap is a major inhibiting factor to the growth of our highly creative VFX industry, with many U.K.-founded companies prioritizing investment abroad, rather than in the UK. We have made proposals to government to neutralize the effects of the cap, so we welcome the opportunity to further these discussions, with the intent to allow productions which have filmed here and have ‘capped out’ of relief, to be incentivized to remain in the U.K. for the VFX as well.”
This consultation will run from November 17 to February 9. UK Screen Alliance and Animation UK will be gathering the views of our members and will be submitting a strong evidence-based response.
Source: UK Screen Alliance and Animation UK