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Budget Priorities 2022

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Budget Priorities 2022

Unleashing the growth potential of the Creative Industries

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The UK’s Creative Industries are a global success story. Prior to the COVID-19 pandemic, the Creative Industries contributed £115.9 billion in GVA and supported 2.1 million jobs in the UK (with a further 1.4 million jobs supported via their supply chains).

The UK’s Creative Industries Tax Reliefs have played a vital role in driving this success. Between 2017-2019, the screen sector produced a return on investment of £13.48 billion in GVA from UK government tax reliefs for film, television and video games production. Over the same period, 219,000 new jobs were created in this sector, UK screen production increased by 74% and £1.02 billion of tax relief seeded £5.11 billion in direct production spend in 2019 (a 61% increase on 2016).

And the sector’s growth potential is even greater still: Independent economic modelling undertaken in
2021 revealed that, by 2025, the UK’s Creative Industries could contribute £132.1 billion in GVA – more than the financial services, insurance and pension industries combined. The sector is also set to create 300,000 jobs by 2025 – enough to employ the working-age population of Hartlepool and Middlesbrough twice over.

Government can unleash this significant economic opportunity by reaffirming their commitment to existing Creative Industries Tax Reliefs – strengthening and extending those that have leveraged major investment into the UK and introducing new tax reliefs in parts of the sector where the potential for growth is strong.

This paper outlines a number of other essential measures that will enable the UK’s Creative Industries to drive growth and prosperity in all parts of the UK. In summary, these recommendations are:

  • Unleash creative innovation across all industries by expanding R&D Tax Relief to reflect the internationally recognised Frascati definition, aligning the UK with other high-growth economies.
  • Bolster consumer spending and deliver benefits to health and wellbeing by cutting VAT from cultural experiences and creative products, including event tickets and audiobooks.
  • Ease the pressure of rising costs by applying Business Rate Relief to cultural sites, venues and hubs and removing the VAT currently applied to historic buildings for maintenance and repair.
  • Invest in our future workforce by delivering the £270 million Arts Premium promised in the Conservative Party Manifesto and enabling Further Education and Higher Education to upskill the next generation.
  • Incentivise a new era of creative entrepreneurship by establishing a new compact between UK government and freelancers and retaining the UK’s strong Intellectual Property framework.

 

Download the full report