Hollywood filmmakers lured to Britain by tax credits
Tax breaks are succeeding in luring top Hollywood filmmakers to Britain, according to the director of the British Film Institute's Film Fund, who argued the country's economy benefited as a result.
Filmmakers working in the U.K. can receive a refund of up to 20-25 percent of the total amount spent on a movie, which Ben Roberts, who heads the distribution of film funding in the U.K., said made good economic sense.
"The tax relief costs the treasury about £150 million [$229.5 million] a year, but in terms of GDP [gross domestic product], it contributes £12 to every pound spent, so it feels like a good deal," he told CNBC on Wednesday.
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The tax breaks were succeeding in attracting Hollywood filmmakers to the U.K., according to Roberts. "Obviously it's used for new film talent here in the U.K. and it attracts big U.S. blockbusters to the U.K. So for the film industry overall it's great business," he said.
Last year, Marvel's "Thor 2" was filmed in Britain, and anticipated sequels "Avengers 2" and the next Star Wars instalment are due to start filming in the country next year.
Movies also boost domestic tourism in the U.K., according to Roberts, who said they cause a "great boom" in overseas visitors. Film London, the city's public film and media agency, found that movies depicting the U.K. attracted 10 percent of tourists to the country.
Walks and tours also provide visitors with the opportunity to see filming locations from movies including the Bond franchise, "Bridget Jones Diary" and "Notting Hill." Roberts said the Harry Potter Studios Tour in particular had caused a "massive attraction of tourism."
"Heritage films, which continue to do well – The King's Speech, Quartet last year - they attract tourism as well to the U.K," he added.
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But despite record box office takings in Britain over the last year, Roberts said the country's film industry is reliant on tax breaks.
Unlike in the U.S., the U.K. film industry is not cyclical and is not dominated by studios, Richards said, which means it is not as sustainable.
But the industry could get a boost from video-on-demand, according to Roberts, which has increased by 50 percent year-on-year. Video on demand allows viewers to stream or download movies to their televisions, game consoles, or computers.
"Although it's still a growing business, that's a new, booming business for film," he said.
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