World
Increased Tax Credit Provides Welcome Relief to U.K. Independent Film Industry
The announcement of the U.K.’s new Independent Film Tax Credit (IFTC) back in March had a near instantaneous impact, at least in the case of one film production.
“Giant,” the biopic of boxer Naseem Hamed and starring Amir El-Masry, was in advanced pre-production when the news landed, with plans to shoot location work in Hamed’s home town of Sheffield and all the interiors — including the essential boxing rings — in Malta. Sets were already being built on the Mediterranean island, which has been courting numerous film productions in recent years thanks to a generous 40% tax rebate initiative.
But then the IFTC was unveiled and the U.K., when it came to producer’s all-important bottom line, was suddenly much more competitive. What had previously been a 20% tax break was now around 32.5% (it was initially billed as 40%, but is actually lower after corporation tax). Given the costs involved in shipping the film overseas, “Giant” didn’t need to pack up its bags.
“As soon as the tax credit came out, we did the analysis and immediately it made more economic sense, straight away, to keep it here,” explains Zygi Kamasa, the head of distributor and producer True Brit Entertainment. “So we pivoted within days of it coming through.”
“Giant” may have been the first, but just six months on from the announcement of the IFTC Kamasa says that it’s contributed enormously to the output of his nascent company — which was only launched in November 2023 with a focus on films for British cinemagoers. Where there was an initial aim to produce three films in its first year, True Brit will soon begin shooting its eighth. And while some — like “Giant” — would have happened regardless of the tax credit, he says “there were movies that were definitely expedited” because of it.
The significant interest and optimism within the British film industry since the IFTC’s announcement, despite not yet being fully implemented, is a far cry from the dark days of 2022. A report commissioned by the British Film Institute (BFI) that year had the key and ironic takeaway that the overall boom in the country’s film and high-end TV sector had led to a corresponding negative impact on the independent sector. It found that the speed and volume of growth strained the sector so much that it couldn’t compete with larger budget international productions on several levels — from accommodating the rising cost of production to securing cast and crew, and ultimately to reaching audiences.
BFI statistics reveal that getting U.K. films budgeted under £15 million ($19.6 million) into production had become increasingly challenging. After plummeting by 31% in 2022, spend on independent U.K. film in 2023 fell a further 11% to just £150 million ($196.9 million).
Now, in 2024, post IFTC announcement, Harriet Finney, BFI deputy CEO and director of corporate and industry affairs, says, “We’ve seen a lot of positivity in the industry. It’s definitely changed the conversation for independent filmmakers in this country.”
The BFI is currently preparing for increased capacity once the statutory instrument and guidance notes are published later this year. Finney explains, “We’re making sure that we’re in the best possible position to deal with what is likely to be a flurry of activity. It feels like there’s a growing sense of confidence around domestic production.”
Simon Williams, managing partner at Ashland Hill Media Finance, reports seeing an uptick in projects considering filming in the U.K. “We’re getting lots of different projects coming to us, asking if they should be shot in the U.K.,” Williams says. He notes that some international producers are exploring the possibility of adapting their scripts to meet U.K. requirements. “The U.K. looks more attractive for film currently, because the tax credit, it’s probably bigger than pretty much anywhere else in the world, aside from maybe Australia. But Australia is far away and it’s costly to take people over there,” Williams said.
However, Williams expresses concerns about potential cost increases. “We don’t want costs to increase by shooting in the U.K., which negates the benefit of the tax credit,” he cautions.
Ashland Hill-backed “The Magic Faraway Tree,” based on Enid Blyton’s beloved book, is currently in production. “The Scurry,” directed by Craig Roberts and starring Ella Purnell, Rhys Ifans and Antonia Thomas, has just finished shooting, which Ashland Hill funded against the increased tax credit. “That film would never have happened if it wasn’t for this increased tax credit. I think the only thing that may deter some lenders from putting money against it [is] if you are entering into a production now, you can’t put a claim in for your tax credit until April next year. Whereas in the current tax credit, you can make interim claims, which from a producer’s perspective, if you have a lender, you can make multiple claims and pay down the loan quicker, rather than doing one big claim in 18 months time,” Williams said.
Alex Ashworth, head of production at Anton, believes the IFTC will make a significant impact, particularly for films in the £5-15 million ($6.5-19.6 million) budget range. “I think it will really help independent film producers where we’ve lost that mid-budget section,” Ashworth says. “There was a long time where that was the U.K. sweet spot, films like ‘The King’s Speech,’ and I feel like the cost of production has gone up so that it’s very hard to make those at that level. Our incentives are good, but they aren’t necessarily comparable to some other territories. So by doing this, you’re offsetting basically the inflation that our production industry has experienced in the last five to seven years. I think it will really help those independent films who are probably struggling to get their finance plans to hit those higher budget levels.”
Ashworth estimates that Anton is currently working on four to five projects with the IFTC in mind for shooting in the next 12 to 18 months.
Producer Alastair Clark, whose recent film “Sister Midnight” premiered at Cannes, also sees the IFTC as a positive development for the industry. “The mood is great,” Clark says. He also points out that while the net benefit is around 32.5% after corporation tax, rather than the initially advertised 40%, it’s still a significant improvement over the previous system.
Clark is already incorporating the IFTC into his project planning. “Certainly, one very solid project right now that we’re raising the finance for. It’s a big part of it,” he says. Clark believes the increased tax credit will reduce the need for riskier private financing in some cases. “Borrowing against the tax credit versus borrowing against an MG (minimum guarantee) or a sales advance, is cheaper, and therefore helps finance plan a budget,” Clark said.
While the industry awaits full implementation of the IFTC, the initial response suggests it could play a crucial role in bolstering the U.K.’s independent film sector and positioning it far more attractively on the global stage. For Phil Hunt at Head Gear Films, it’s certainly a very positive move after the “nightmare of Brexit,” which he claims “ripped the heart out of indie co-productions.” The veteran producer says he’s already noticed that producers in North America are “definitely now looking to put more productions in the U.K. and, when talking to folk in LA, there seems to be a drain away from the U.S.”
But that’s not to say that execs are seeing IFTC at the perfect solution, of course. As with most newly-launched financial incentives, there are hopes that it will be tweaked and changed along the way, especially with the U.K. under a new Labour government that has, traditionally, been more supportive of the arts. An ideal situation for many is that the 40% rebate actually does mean a full 40% for producers.
“I’d love the government to look at that,” says Kamasa. “I think it should be the full 40%, because then you’d be truly competitive with places like Malta and Italy.”
HOW THE IFTC WORKS
The IFTC is calculated on “core expenditure” related to production activities, with qualifying companies able to claim up to 80% of their core expenditure or the amount of U.K. core expenditure, whichever is less. For a £15 million ($19.6 million) budget film, this could mean a maximum credit of £6.36 million before tax.
After corporation tax, which varies between 19% and 25%, the actual cash benefit could range from £4.77 million ($6.26 million) to £5.15 million ($6.76 million). This represents a substantial increase from the previous Audio-Visual Expenditure Credit (AVEC) system, which would have provided between £3.06 million ($4.01 million) and £3.30 million ($4.33 million) for the same budget.
The BFI will assess film budgets to ensure they meet the IFTC criteria. Productions that exceed the £15 million budget cap during filming will have the option to continue with the IFTC or switch to the AVEC system.
Claims for the IFTC can be submitted to HMRC (His Majesty’s Revenue & Customs) from April 1, 2025, for expenditure incurred from April 1, 2024, provided principal photography began after April 1, 2024.
World
Controversy plagued UN agency that employed Oct. 7 terrorists facing new problems as country redirects funding
Pressure is building on the controversial U.N. agency UNRWA over its alleged and extensive ties with terror leaders that has propelled hatred for Israel and support for terror through its curricula. Even as 159 countries in the U.N. General Assembly voted in favor of a resolution affirming to “fully support” UNRWA, last week, Sweden announced on Friday that it has decided to end funding to UNRWA due to a ban placed on the agency by the Israeli government and will redirect Gaza aid to other organizations.
Yet, while the U.N. continues to show solidarity with UNRWA, two informed sources confirmed to Fox News Digital that in spite of the vocal solidarity, there is dissension among the ranks.
One U.N. source explained that “several agencies have had behind-the-scenes discussions” about who might “take over and run” UNRWA programming. “One of the main and most notable agencies doing so is the United Nations Development Programme,” the source claimed.
“The UNDP has come forward and said that they can take over from UNRWA to advance peace,” the source said. They noted that U.N. Secretary-General António Guterres “shot those requests down,” leading to an “internal conflict.” The source elaborated that recent events “show that there are elements of the U.N. that recognize the challenges and clear issues with UNRWA,” but that “even as other agencies are ringing the alarm bells,” their “offers are being shot down at the highest levels” of the U.N.
The government’s decision comes after a 14-year-old boy was stabbed to death by a classmate following a social media fight.
Albania has announced a ban on TikTok for one year after the killing of a teenager last month raised concerns over the influence of social media on children.
The ban of the popular video app will come into effect early next year, Prime Minister Edi Rama said on Saturday after meeting with parents groups and teachers from across the country.
“For one year, we’ll be completely shutting it down for everyone. There will be no TikTok in Albania,” Rama said.
There was no immediate comment from TikTok.
The Albanian government’s decision comes after a 14-year-old boy was stabbed to death in November by a classmate after arguments between the two boys began on social media. Albanian authorities held 1,300 meetings with teachers and parents following the stabbing.
Rama has blamed TikTok in particular for fuelling violence among youth in and outside school.
Videos had emerged on the app of minors supporting the killing.
“The problem today is not our children. The problem today is us. The problem today is our society. The problem today is TikTok and all the others that are taking our children hostage,” Rama said.
The prime minister said Albania would see how the company and other countries react to the one-year shutdown before deciding whether to allow the company to resume operations.
The opposition has rejected the government’s decision to ban the app.
“The dictatorial decision to close the social media platform TikTok … is a grave act against freedom of speech and democracy,” said Ina Zhupa, a lawmaker from the main opposition Democratic Party.
“It is a pure electoral act and abuse of power to suppress freedoms.”
Several European countries, including France, Germany and Belgium, have enforced restrictions on social media use for children.
In one of the world’s toughest regulations, Australia approved in November a complete social media ban for children under 16.
TikTok has also faced accusations of espionage in the United States and is under investigation by the European Union over claims it was used to sway Romania’s presidential election in favour of a far-right candidate.
TikTok attracts young people in particular with its seemingly never-ending scroll of short videos and has more than one billion active users worldwide.
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