Referral of the proposed Business Rates Relief for Film Studios scheme by HM Treasury
The Subsidy Advice Unit (SAU) has accepted a request for a report providing advice to HM Treasury (HMT) concerning its proposed Business Rates Relief for Film Studios scheme.
Administrative timetable
| Date | Action |
|---|---|
| 28 January 2025 | SAU’s report to be published |
| 3 January 2025 | Deadline for receipt of any third-party submissions |
| 12 December 2024 | Beginning of reporting period |
Request from HM Treasury
12 December 2024: The SAU has accepted a request for a report from HM Treasury concerning the proposed Business Rates Relief for Film Studios scheme (the Scheme). This request relates to a Subsidy Scheme of Particular Interest.
The SAU will prepare a report, which will provide an evaluation of HM Treasury’s assessment of whether the Scheme complies with the subsidy control requirements (Assessment of Compliance). The SAU will complete its report within 30 working days.
Information about the Scheme provided by HM Treasury
The Business Rates Relief for Film Studios scheme aims to support film studios in England, by giving a 40% relief on their business rates bills until 2034. By providing a discount on business rates bills, this Scheme aims to stop a market failure arising in the film studio sector in England.
The film studio sector is uniquely placed in comparison to other sectors. Film studios are responsible for the production of a significant quantity of economic spillovers, but are also a lynchpin for film production, which is one of the UK’s most important exports, and brings with it significant cultural benefits to UK society, as well as strengthening the UK’s soft power and global standing abroad. However, although film studios themselves are immovable, film productions are highly internationally mobile, which means that they can readily move wherever is cheapest. In order to absorb the increased business rates liabilities which have arisen for the sector, the government’s assessment is that (in the absence of this subsidy scheme) studios in England would be required to pass through the costs charged to productions, thereby significantly increasing the cost of filming in England. This passthrough of costs would reduce the competitiveness of the UK as a filmmaking destination, and lead to more films moving abroad. The consequence of this would be a weakening of the UK’s film output, and of the economic spillovers and cultural benefits which accompany the production of UK film.
The scheme is available to any properties assessed as ‘film studios’ for valuation purposes by the Valuation Office Agency (VOA). The government estimates that around 40 properties will be eligible for this scheme - more detailed guidance on eligibility will be published by the Ministry of Housing, Communities and Local Government in due course. There is no maximum subsidy which can be awarded under the Scheme, but the estimated costs were published at Spring Budget 2024 and certified by the Office for Budget Responsibility (OBR), which estimated that this Scheme would cost £5 million in its first year (2024 to 2025), rising to £50 million by 2028 to 2029.
The Scheme will be administered by Local Authorities, who will apply the relief when issuing business rates bills to eligible properties. Local Authorities will be fully compensated by central government for the loss of income as a result of this relief. The Scheme will be backdated to 1 April 2024.
Information for third parties
If you wish to comment on matters relevant to the SAU’s evaluation of the Assessment of Compliance concerning the Business Rates Relief for Film Studios Scheme, please send your comments on the date stipulated in the timetable above. For guidance on representations relevant to the Assessment of Compliance, see the section on reporting period and transparency in the Operation of the subsidy control functions of the Subsidy Advice Unit.
Please send your submissions to us at [email protected], copying the public authority: [email protected].
Notes to third parties wishing to make a submission
The SAU will only take your submission into account if it can be shared with HM Treasury. The SAU will send a copy of your submission to HM Treasury together with its report. This is to allow the public authority to take account of the submission in its decision as to whether to make or modify the Scheme or its assessment. We therefore ask that you provide express consent for your full and unredacted submission to be shared. We also encourage you to share your submission directly with HM Treasury using the email address provided above.
The SAU may use the information you provide in its published report. Therefore, you should indicate in your submission whether any specified parts of it are commercially confidential. If the SAU wishes to refer in its published report to material identified as confidential, it will contact you in advance.
For further details on confidentiality of third party submissions, see identifying confidential information in the Operation of the subsidy control functions of the Subsidy Advice Unit.
Contacts
- SAU project team: [email protected]
- CMA press team: 020 3738 6460 or [email protected]