Pressure builds for 25% prints and advertising tax relief for UK independent films at autumn budget

The UK parliament’s cross-party culture, media and sport (CMS) committee has called on the chancellor to bring in a targeted 25% tax relief for the distribution and exhibition of UK independent films at the autumn budget (November 26).

In a letter to the chancellor, Rachel Reeves, the committee has backed a 25% tax relief for the prints and advertising costs of films claiming the Independent Film Tax Credit (IFTC), as recommended in the commitee’s in-depth report on British film and high-end TV published in April.

“Looking specifically at the support for independent British filmmaking, the IFTC is already showing signs of helping the domestic sector to make films, but the value of this cannot be fully realised unless those films are seen,” stated the committee’s chair, Caroline Dinenage, in the letter to Reeves.

“Whilst we have witnessed the very best of British filmmaking recently with the likes of Conclave [over £9m at UK-Ireland box office for Black Bear] receiving great awards acclaim or, more recently, I Swear [£4.1m to-date at UK-Ireland box office for Studiocanal and still on release] playing to packed audiences nationwide, there are countless films that end up not getting the audiences they deserve.

“Even top-quality films cannot find an audience without distributors and their investment in promoting films. Cinemas will not programme films without marketing spend attached, as the risk would be too great. The IFTC will successfully offset the risk of making independent British films, but alone it will not offset the challenges of distribution and exhibition.”

The Film Distributors’ Association has long been campaigning for a P&A specific tax relief, and in recent months has commissioned modelling of the potential impact of its proposal, which found a return of more than £7 for every £1 spent on the relief, including a net positive return to the Treasury.

“To put this into further perspective, the cost of this much-needed intervention would only equate to 2% of the total amount of film tax relief claimed on production costs,” noted Dinenage.

“Cinemas are the driving force behind film’s income streams, and they are an easy and affordable way to bring culture to our towns and cities,” she added. “But, to thrive, our cinemas need more high-quality, well-marketed British films.”

The IFTC, officially known as the enhanced audiovisual expenditure credit for low-budget films, is aimed at films with a total core expenditure, or production budget, of up to £15m. They can now benefit from an enhanced credit of 53%, which equates to an actual relief of just under 40%, on up to 80% of qualifying expenditure.

Those productions with a total core expenditure of up to £23.5m can also qualify for the IFTC; however, they can only claim the IFTC up to a maximum of 80% of £15m of the UK qualifying spend.

• Teresa Moneo joins ‘Ballad Of A Small Player’ producer Good Chaos