The UK industry has welcomed measures announced by the Chancellor of the Exchequer Jeremy Hunt in this week’s Budget to support independent filmmakers, studios and VFX houses.

In his budget, Hunt announced the introduction of a 53% expenditure credit, equating to a tax relief of approximately 40%, for UK film productions with a budget up to £15m. The intervention is designed to support low-to-medium-budget British films which have struggled to get financed in the UK in recent years.

3. Bectu said that the budget didn't go far enough to support workers

Bectu said that the budget didn’t go far enough to support workers

The package of measures in the Budget also included a 40% relief on gross business rates bills for film studios in England.

Hunt also announced a 5% increase in tax relief for UK visual effects costs in film and high-end TV, under the Audio-Visual Expenditure Credit (AVEC). UK visual effects costs will also be exempt from the AVEC’s 80% cap on qualifying expenditures.

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The additional support for UK independent filmmakers was welcomed by BFI Chief Executive Ben Roberts, who said: “This is a dramatic moment for UK film, and the most significant policy intervention since the 1990s. The positive impact will be felt across our industry, and through all the new films that audiences will get to enjoy.”

Pact CEO John McVay said: “I’m pleased that the Government has recognised the important role the British independent film sector plays in developing key talent and sustaining jobs across the economy. The sector has reached a critical point and this intervention will provide a lifeline to indie film producers by allowing them to access funding which will attract key creative talent and in turn give them the ability to recoup their initial investment.”

Addressing the 40% rate relief for UK studios, Adrian Wootton, CEO of the British Film Commission, said: “Recent increases to studio business rates in England and Wales have threatened to impact the UK’s ability to compete globally… The rates relief announced today will help ensure our studios can continue to thrive, planned developments proceed, and the UK continue to attract increasing levels of domestic and global production, maintaining our reputation as one of the best places in the world to make film and TV.”

Meanwhile VFX specialist Framestore welcomed the additional support for visual effects companies in the UK. Framestore CEO Mel Sullivan said: “While the UK VFX industry is recognised around the world for its creativity and innovation, it faces stiff competition from other territories offering generous tax incentives. Today’s statement promises to be a real boost for our industry, and, more widely, a driver for digital skills, jobs and growth across the UK.”

However, Philippa Childs, Head of trade union Bectu, said that while the Spring Budget supported creative businesses, it had ultimately ignored the crisis being felt by freelancers and the UK’s creative workforce. She said: “We welcome a number of promising announcements in today’s Spring Budget, including tax relief on films under £15m, a permanent rate for theatre tax relief and the likely extension of VFX tax breaks.

“However, this budget is one that has met a number of business asks but contains no measures to directly support the freelancers that make these industries so successful. The government must match its investment in creative businesses with urgent and sustained support for a workforce that has long been struggling.

“Bectu members consistently tell us they are now worse off than in 2020, and many continue to feel the effects of insecure employment. A prolonged recruitment and retention crisis in the sector is well-established, and we recently sounded the alarm over a shocking work drought in film and TV. With more than a third saying they will leave the industry in the next five years, there is little in this budget that seeks to address this skills drain.

“Despite some promising interventions, you simply cannot have a thriving creative sector without a thriving workforce. Whilst today’s budget recognises the creative industries as a high-growth priority sector for government, it is a missed opportunity to back up this rhetoric with reassurance and the immediate support needed for those who work in them,” said Childs.

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