New British film tax incentive approved by EU

The European Union has approved the government’s plans to extend tax breaks to the British film industry.

The Chancellor George Osborne says he hopes the new 25% tax credit will help to attract more productions, such as the Oscar-winning Gravity, to the UK. The Treasury says the existing scheme, which offers producers only 20% back, supported 222 films last year alone.

Under the new proposals, films that qualify as British, with budgets £40 million, will receive an additional £1 million towards their production costs.

Sky 1 is turning Ashley Jensen's Agatha Raisin from a TV movie into a series
Sky 1 is turning Ashley Jensen’s Agatha Raisin from a TV movie into a series

The announcement coincides with a visit by Mr Osborne to the set of a new British detective series, Agatha Raisin; TV shows will also be eligible for the new tax incentive.

The Chancellor has pointed out that last year, eight British-made films were nominated for Oscars. “A key part of our long-term economic plan is supporting our creative
industries that contribute billions to the economy and provide millions of jobs,” he said. “We want to see more films, like Gravity and Avengers: Age of Ultron, made in
Britain and that’s why we’ve made our film tax relief even more generous.”

Welcoming the extension to the tax relief, Amanda Nevill, the head of the BFI, which allocates lottery money to film production and promotes Britain to foreign producers, said, “The film tax relief is a key ingredient in the UK’s winning combination of outstanding film-making talent and crews, world-leading studios and facilities, and iconic locations. It keeps us competitive on the world stage, and helps grow our economy and create jobs at home.”

The policy was also praised by the chief executive of Pinewood studios, Ivan Dunleavy, who said the announcement was “a clear demonstration of how this government has supported UK film and helped fuel growth in the creative industries to the benefit of the taxpayer.”