How will the creative sector handle Brexit?
Ian Gibbon
Specialist advisor to film and TV producers, assisting with financial reporting, accounting, tax and accessing creative tax reliefs.
The European Union (Notification of Withdrawl) Act 2017 was passed on 29 March 2017. This started a two year period of exit negotiations.
All business sectors, including of course the creative sector are asking and speculating what future arrangements need to be made. The future is going to be dependent on the negotiations for a deal.
The broadcasting sector looks particularly worrying. The UK is the leading European hub for the creative content sector. There exists a binding set of rules that UK broadcasts may be broadcast throughout Europe. The worry is that the EU commission will not give commissions to non EU countries.
It is accepted that one of the key factors for the success of film and TV productions in the UK has been the generous application of film and TV tax credits. Presently these credits are regulated by EU State Rules. The debate now is will the UK be able to do what it likes in respect of these incentives. It would be tempting to wish for ever greater incentives but the worry would be whether such a change would initiate draconian measures by the EU.
Aside from the tax credits the other single factor assisting the growth of the sector has been the skill base of people. But this success has been predicated not in a small part to the freedom of movement of people. Films and television productions are dependent on the skills, knowledge and know how of creative people. UK productions have put together the best people from around the world to contribute to content.
One potential solution that has been suggested is the issue of a cultural passport for high end talent.
Many regions around the UK receive generous access to funds from the EU. It is likely that this will stop. The regions will then be deprived unless the UK government steps in and replaces these funds.
Currently Europe is the largest target market for UK exports followed by North Amercia, Asia, Latin America and the Middle East. The largest markets are North America and Asia so it will be interesting whether UK productions will focus more away from Europe.
It would appear that the suggested two year period for negotiations will not be long enough. However a period of longer negotiations will be off putting and engender uncertainty.