PACT proposes 40% tax credit to stimulate independent production in the UK
The Producers Alliance for Cinema and Television (PACT) has proposed that a 40% tax credit be introduced to curb declining rates of success with regards to the UK’s independent production industry.
The incentive would only be made available to domestic productions with a budget between GBP2 million and GBP10 million.
PACT’s Chief Executive, John McVay states: “over a long period of time we were hearing that there was a structural problem in the market – that pre-sales had declined over a period of time. I thought we should get some evidence of what is actually going in the shape of the domestic market,”
Rebecca O’Brien of Sixteen Films adds: “we can see it is not an expensive thing to do, the mechanisms are set up. If you take your problems into your own hands, you’ve got more chances of getting results. With Brexit, the Government will be looking for industries to seek the answers to their own problems and innovative ways of tackling economic issues.”
The proposition was made in the light of a study commissioned by PACT, entitled The State of the UK Independent Film Sector. A survey was distributed as part of the study which saw 78% of its respondents admit to deferring some or all of their producer fees since 2007.
At a glance, these statistics might appear to contradict the GBP1.6 billion spend brought in by the UK production industry in 2016, but the report suggests that these figures better represent the UK’s popularity with high-budget international projects such as Rogue One and Justice League.
The report also found that of the 6,805 production companies based in the UK, 24% of them brought in a turnover of less than GBP49,000 in 2015.
The UK’s TV tax relief favours high-end productions, requiring a minimum spend of GBP1 million per broadcast hour. Feature films on the other hand must only spent a minimum of 10% of their budget locally to receive the same 25% tax rebate.
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