Budget 2012: Tax breaks for TV production

Wallace and Gromit creator Nick Park Nick Park had been considering moving Wallace and Gromit production abroad to save money

A tax credit scheme for TV production and animation firms is to be introduced, in a bid to keep creative talent in Britain.

Chancellor George Osborne announced the plans in Parliament as part of the new Budget for 2012.

Mr Osborne said it was the government's "determined policy" to keep Wallace and Gromit animators Aardman in Britain.

Last month, Aardman bosses admitted they had been considering moving production abroad where it was cheaper.

In reaction to the news, Aardman said the tax credit would be "transformational for our industry".

"We have seen a dramatic decline on UK television of home produced animation and we now have a shot at reversing that trend," said Miles Bullough, head of broadcast and development.

"The credit will create thousands of UK jobs and our research shows that there will be a long term financial gain the for the UK."

'Top international investors'

Lobby group Animation UK had been urging Mr Osborne to consider introducing tax breaks, as it believed production was at risk of disappearing from the UK completely.

Mr Osborne said he hoped the changes would prevent that from happening, not just for animators but for high-end drama productions.

"Not only will this help stop premium British TV programmes like Birdsong being made abroad, it will also attract top international investors like Disney and HBO to make more of their premium shows in the UK," he told MPs.

"It will support our brilliant video games and animation industries too.

Bob The Builder Bob The Builder is currently made in the US

"Because, Mr Deputy Speaker, it is the determined policy of this Government to keep Wallace and Gromit exactly where they are."

Recent shows, such as The Tudors, Camelot and the Julian Fellowes' drama Titanic, were all made abroad to take advantage of tax incentives in other countries.

Animation UK said it was "thrilled" by the announcement, saying it was "the news we have been waiting for".

"Overseas animators have long received support from their governments and hopefully now our industry will be able to compete on a level playing field," chairman Oli Hyatt said.

"It would have been a crime for it to disappear from the UK and that was a very real threat. Today's announcement will hopefully guarantee the long term survival of our industry and ensure it continues to be an industry we are proud of."

Key members of the TV production industry have also welcomed the news.

Kudos Film and TV, which makes shows including The Hour, Law and Order and Spooks called it "fantastic news".

Its chairman, Stephen Garrett, added: "The return on this relatively small investment from the Government will significantly benefit the UK's economy, generating jobs and growth, boosting tourism and giving the UK taxpayer great value for money."

'Affordable location'

Left Bank, whose shows include Wallander and DCI Banks, also welcomed the proposals.

Chief executive Andy Harries said: "The proposed changes in the UK tax laws regarding television would give the British TV industry a much needed shot in the arm.

The chancellor's announcement also served as a joke based on his past references to Labour leader Ed Miliband's likeness to animated character Gromit

"British production talent is responsible for some of the best television in the world and at the moment many productions, which could very easily be shot in the UK, are being made abroad and many talented creatives are moving elsewhere."

HBO's Glenn Whitehead added: "Today's news on a new tax incentive has turned the UK from one of the most expensive options into a competitive and affordable location.

"We would therefore love to bring more production to the UK."

The British Film Commission's chief executive Adrian Wootton said: "This has fantastic implications for the UK's production industries and the UK economy."

He added that the introduction of tax breaks in production would "create jobs" and "more investment in the UK".

A BBC spokesperson said: "We welcome the government's desire to support the production industry in the UK and we are keen to shoot more BBC projects on our shores.

"We look forward to engaging with the detailed proposals and how they might be implemented to best effect for the industry as a whole."

In 2009, exports of children's TV programmes that were made in the UK were worth £150m, according to the Department of Culture Media and Sport.

And the UK is the second biggest exporter of television content in the world, with exports worth more than £1.3 billion per year.

Mr Osborne's tax break proposals will be subject to state aid approval and a consultation process, but could be introduced by April 2013.

The chancellor also said there were plans to improve technology in Britain, which will include delivering "super fast broadband" to 90% of the population across 10 of the country's leading cities.


More on This Story

Budget 2012

Related Stories

The BBC is not responsible for the content of external Internet sites


This entry is now closed for comments

Jump to comments pagination
  • rate this

    Comment number 42.

    Why dont we have a UK version of google ebay amazon warner brothers ,its because people sticking their nose up at the entertainment industry in this country. Dont forget walt disney came from the UK n moved to america,ridley scott also and had to move to america to make his films. Just think what we have lost because we didn't support them n take them serious.

  • rate this

    Comment number 41.

    Many comments on this article show how short sighted and ill informed people are. According to some sources the global entertainment industry is worth $2 trillion. Why shouldn't the UK do what it can to get a bigger slice of that pie. Some people here think that cartoons/games don't make big money or aren't a proper industry. Have they not heard of Disney, Pixar, Nintendo, Playstation etc?

  • rate this

    Comment number 40.

    Why are people against this? You can't pick and choose what industries you want to get Britain out of the economic depression.

  • rate this

    Comment number 39.

    Why money for TV, we have so much rubbish on TV it would be better to stop such long transmissions, they are not needed, there are far to many violent programs, which is why I watch very little. It would be healthier to go for walks, read books, cycle. If they need more money then they should stop paying such high salaries,bonuses. to themselves.

  • rate this

    Comment number 38.

    4. Bibi: "A much higher priority than the NHS, the elderly, the poor and the unwaged, obviously."

    Keeping tax paying multi-million pound entertainment companies operating in this country is a very good way of paying for those.

  • rate this

    Comment number 37.

    Strip the country and get out fast - same as before and same as ever.
    As the people of this country what recourse is there to dump these hoods?
    But for who... ?
    Oliver Cromwell... lord protector ?
    You can't seriously reward Lab. with a vote.
    A Govt that should have been brought to court for negligence as the Icelandic people are doing the their sacked Priminister.

  • rate this

    Comment number 36.

    @beemoh Yeah what with 'Legally Blonde: The Musical' and 'One Man Two Guvnors' doing the rounds our theatres really have become elitist, high-concept hell holes haven't they...

  • rate this

    Comment number 35.

    @12. A budget for fatcats and bankers...

    Really? Are you reading what you want to read. Loopholes are closing, stamp duty on mansions is increasing, banks are frozen out of the corporation tax savings, money is being invested in the creative industies, the base rate of tax has risen.
    But you don't care. You want to repeat "schools and hospitals", and "too far too fast" over and over like robots.

  • rate this

    Comment number 34.

    This is the kind of strategy we should be pursuing. Now if only Osbourne would have the guts to stand up to corporate profits and introduce a similar scheme to keep more jobs in the UK across the board.

  • rate this

    Comment number 33.

    look at all the tory traitors who use well so and so did this so we must as the excuse for what is clearly just another way tories are stealing from the people to give to their rich mates.
    Time for a general strike and to hit the tories in the only place they worry abotu their back pocket

  • rate this

    Comment number 32.

    "18. sam
    What a waste of time tax breaks for cartoons but not for school meals."

    I can understand your logic, but what you have to understand is that some other countries such as Canada have introduced aggressive tax polices to attract these industries. These are businesses can be relocated easily.

    So what best for the UK? 40% of nothing and no jobs, or 20% of £100 millions plus jobs?

  • rate this

    Comment number 31.

    #29. Your are thinking of Sky.
    At least you can watch all the BBC Natural History programs you missed the first time around.

  • rate this

    Comment number 30.

    Do we have a proper definition for "High-End" television?

    If it means "Big-budget", a more broad break for ambitious, smaller producers and broadcasters has to have a better overall effect than saving ITV a few bob on the next series of Downton, surely?

    If it means "fancy drama", then aren't we going to wind up with highly elitist schedules, and we see the form go the same way as theatre?

  • rate this

    Comment number 29.

    Don't we just normally import TV trash from other countries anyway because it's cheaper than making our own?

  • rate this

    Comment number 28.

    This is not about creating better TV shows or video games, it is about reducing the massive decline of jobs, UK investment, and exports that has been caused by other countries already offering these incentives.

    Games, films and TV cost millions to make - and a small incentive like the one offered can and will draw that business to the UK. More jobs, more taxes, more future growth potential.

  • rate this

    Comment number 27.

    How about tax breaks for real manufacturers and not just the virtual few. I.e. Ship builders, steel works, power plants, plastics, chemical companies, large scale fabrication. Come on UK Government think big. Lets take on the real world.

  • rate this

    Comment number 26.

    It's amazing how many posters here completely miss the point and haven't got a clue what big money there is in animation, videogaming etc. The industry may be aimed at youths, but the money is very grown up. Keep it healthy, and it will provide work for thousands. It's the 21st century.

  • rate this

    Comment number 25.

    Surely no-one grudges the tax break for the TV industry, as TV touches all our lives so we all benefit? Plus let us not be shy about saying it.....the British are excellent programme makers, often the envy of the world.
    We are quick to criticise ourselves, so for once it is time for a little self-congratualation.

  • rate this

    Comment number 24.

    Like anything else, if people want to move rproduction abroad to save money that's fine by me. But you won't be allowed to do any further business with the UK in any shape or form, neither will you be allowed back in the UK under any circumstances, even if it's to see family.

  • rate this

    Comment number 23.

    One can only assume that Osborne's logic is, "We're going to need some pretty impressive bread and circuses to get away with the ideology-based, trickle-down policies we have in mind".

    In other news, Bakeries to be tax-exempt...


Page 1 of 3


More Entertainment & Arts stories



Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.