British Tax Breaks Could Threaten Irish Film Industry

Tax changes expected to be announced by British chancellor of the exchequer George Osborne in the budget speech tomorrow could threaten Ireland's ability to attract high-end British television drama productions.

Ireland has benefited from the reluctance of the British authorities to extend the tax breaks given to films to television dramas.

The catalyst behind the growth in the Irish audio-visual sector, spending on television drama in Ireland was €241 million in 2010, more than twice that of film, which came in at €117 million. The 2011 figures, due soon, are likely to show a similar pattern.

In 2012 the BBC is due to spend €11 million on two major drama series in Dublin – €8 million on Ripper Street, set in east London during the time of Jack the Ripper, and €3 million on the second series of the comedy police drama Vexed.

Other series such as The Tudors, Camelot, ITV’s Primeval, Murphy’s Law and League of Gentlemen have all been made here. Unlike Britain, Ireland retains tax incentives for TV drama production companies through section 481. That is one of the reasons Titanic: Blood and Steel, a €22 million drama set in Belfast, is largely being filmed in Dublin.

A campaign lead by Downton Abbey creator, Julian Fellowes, is calling for the British government to offer tax incentives to television dramas and treasury sources in Britain, Mr Osborne is considering offering the same discount on corporation tax for British television companies as for film companies, which is between 20 per cent and 25 per cent.

However Torlach Denihan, employers’ confederation Ibec audio-visual director, said Ireland would still be able to compete because of the 12.5 per cent corporation tax rate.

He said the Government should extend section 481 tax breaks to 2020 to give certainty to the industry, but tax was only one of a number of incentives for overseas production companies.

“Whatever response the Government makes should hinge on the details,” he said, “but we have got to stay competitive”.

(H/GK)