Tax breaks for films have short shelf life
Government plans to offer tax breaks to encourage film production in the UK faced the cutting room floor this week following European Union proposals to end ‘unfair’ tax competition between member countries.
The chancellor, keen to boost the film industry, had considered raising the #15m ceiling below which companies can write off the cost of film production against tax. But Gordon Brown was preparing to sign proposals calling for greater co-ordination between member states over industry tax breaks.
Earlier this month, the government published a report from the creative industry taskforce. It boasted that the sector, which has backed successful UK films such as ‘Lock Stock and Two Smoking Barrels’, contributes #60bn a year to the economy.
The Film Finance Forum, a new government-sponsored film body, met earlier this week to forge closer links between film companies and the City.
Members include finance directors from leading film companies such as Polygram Filmed Entertainment and Miramax & Hal films.