Budget 2012: TV tax credits will keep Wallace & Gromit in the UKBudget 2012: TV tax credits will keep Wallace & Gromit in the UK

Budget 2012: TV tax credits will keep Wallace & Gromit in the UK

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George Osborne has vowed to “keep Wallace & Gromit exactly where they are” by introducing tax breaks for British animation, video games and certain “high-end” television productions.

In his Budget, the Chancellor pledged tax breaks for certain productions, after major businesses including Wallace and Gromit-creator Aardman Animations warned they would have to move production overseas because they could no longer compete in Britain.He also used the measure to level a jibe at Labour leader Ed Miliband, who has been compared to Aardman's clay creation, saying pointedly: "We want to keep Wallace and Gromit exactly where they are".

There was no detail about how the tax breaks will work, but they are expected to offer up to 25pc relief. “Not only will this help stop premium British TV programmes like Birdsong being made abroad, it will also attract top international investors like Disney and HBO to make more of their premium shows in the UK,” Mr Osborne said. Birdsong, the BBC’s adaptation of Sebastian Faulks’ novel, was filmed in Hungary, as was ITV’s forthcoming series, Titanic, which was written by the Downton Abbey-creator Julian Fellowes.

The tax breaks for the TV, video games and animation industries follow similar measures for the UK film industry, which helped to generate over £1bn of investment in UK productions last year.They will enable UK producers and animators to compete more effectively with countries such as Ireland and Canada which have benefited from a steady exodus of talent from Britain, because they subsidise production budgets by up to 50pc through tax breaks and funding.

Mr Osborne’s announcement follows sustained campaigns by television and games producers, who warned they were “scrabbling for crumbs, selling up and shipping off”.UKIE, the trade body for the games and interactive entertainment industry, said the measures would help the UK to “reclaim its position as a world leader in games production”.Richard Wilson, chief executive of TIGA, the trade association representing the UK Games industry, added that it would safeguard 4,661 jobs and generate £172m for the Treasury in the next five years.

Andy Harries, chief executive of Wallander-producer Left Bank Pictures, said the changes give the British TV industry a “much needed shot in the arm”. The company is currently shooting two productions – Mad Dogs and Strike Back - in South Africa, because it is the only way to meet modest television budgets, but Mr Harries said it would now look at making ambitious series in the UK.

Oli Hyatt, chairman of Animation UK, the lobby group, and founder of animator Blue Zoo, said: “It would have been a crime for it to disappear from the UK and that was a very real threat. Today’s announcement will hopefully guarantee the long term survival of our industry and ensure it continues to be an industry we are proud of.”

Source: The Telegraph

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Liezel Vermeulen specialises in rebates and co-production status administration of new international animation shows. When not number-crunching, she indulges her passion for documentary films, further education, freelance writing and is a board member of Animation South Africa.