The UK film industry is currently facing a major setback as some of the country’s leading film and TV studios find themselves caught in a property tax storm. This surprising tax situation has caused a lot of worry in the industry, prompting concerns that it could hinder future growth and development.
One studio, in particular, Sunset Studios, has been forced to pause its ambitious $900 million expansion into the British market due to the uncertainty caused by the property tax bombshell. Industry insiders have now brought their concerns directly to Culture Secretary Lucy Frazer, hoping for a solution that will protect the future of the thriving film and television sector in the UK.
UK Film Studios Seek Support as Property Tax Bombshell Puts Sunset Studios’ UK Expansion on Pause
Culture Secretary Lucy Frazer has engaged in discussions with industry representatives regarding the potential significant increases in business rates, aiming to protect Britain’s globally acclaimed production facilities. While the final decision rests with Chancellor Jeremy Hunt, Frazer’s involvement could play a crucial role in advocating for a reassessment.
The concern comes at a time when Sunset Studios Waltham Cross, a £700 million ($900 million) studio development in Hertfordshire, has been put on hold due to uncertainties surrounding property taxes. Construction plans are delayed, with the duration of the delay uncertain.
The valuation office’s recent updates to rateable values have prompted studios like Pinewood and Warner Bros. to lobby against the changes, with support from Netflix and coordination efforts by the British Film Commission.
Rising Property Taxes Threaten UK Film Industry’s Growth and Studio Investments
Industry insiders warn that increasing property taxes pose a significant threat to new studio investments in the UK, particularly at a time when studio space is highly sought after. The pause in Sunset Studios’ construction serves as a disappointing outcome of this issue. Concerns have been raised by other developers as well, including Giles Dobson from Bidwells property consultancy, who cautions that rising property taxes could undermine the UK’s status as a global entertainment hub.
The Valuation Office Agency (VOA) is actively assessing the situation, with an uncertain outlook for resolution. Additionally, Elstree Studios, housing The Crown and Star Wars, requires significant redevelopment funding due to asbestos discovery, according to Hertsmere Borough Council.
While the Treasury provides business rate relief, it remains unclear whether UK studios are included.