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U.K.’s Production Tax Breaks Spur Burst of Training for Below-the-Line Jobs

In Britain, the tax breaks keep on coming.

Last month, in his annual budget statement, Chancellor of the Exchequer George Osborne upped the amount of relief available for larger films: Those with a qualifying budget of £20 million ($29.8 million) or more will now get an offset of 25% for all eligible U.K. expenditures. Previously, the rate of tax relief for those films was 25% of the first £20 million of qualifying expenditures only, with any excess spending allowed just a 20% credit.

The change works out to an added $2.5 million break on a $100 million picture. (Hollywood movies produced in the U.K. last year, including “Guardians of the Galaxy,” “Maleficent” and “Thor: The Dark World,” presumably would have benefited.)

Moreover, reacting to the global impact of TV shows produced in the U.K. such as “Downton Abbey” and “Game of Thrones,” the government also enhanced the tax relief for high-end smallscreen productions: The minimum U.K. spending threshold for these will be reduced to 10% from 25%. Plus, a new children’s TV offset, available to kids’ gameshows and competitions, kicks in this month.

These enhanced incentives are sure to put further pressure on an already hot market for below-the-line jobs — including such positions as production accountants, visual effects artists and camera operators — triggering more funding for training in those occupations.

The government has already pledged to contribute two more years of funding, worth $5.96 million, to Creative Skillset, an organization that awards grants to filmmaking-education programs in such areas as high-end TV, visual effects, videogames and animation.

According to Stephen Bristow of accounting firm Saffery Champness, which advises the government, the incentives “have been a huge success for the production sector, for British filmmakers as well as international producers who want to make their shows and films here.”

A recent study commissioned by the British Film Institute, the British Film Commission, and Pinewood Studios showed that in 2013 the U.K. movie industry supported 97,300 full-time jobs, generated $5.5 billion in added value, and contributed $1.64 billion to the treasury.

“Growth in the creative sectors has been much faster and more impressive than forecast, and the industry needs to scale up and skill up quickly to meet that need,” says Pinewood chief exec Ivan Dunleavy. “Support of training and skills is what we need to help to deliver that.”

Alison Small, chief exec of Britain’s Production Guild, says the new incentives have spiked demand for guild members.  “We’ve received calls every day from all over the U.K. and Europe, and we are now taking bookings six months in advance so production companies can lock people in.”

Doing its part on the training front, the guild has set up courses in Northern Ireland, Scotland, Birmingham and Bristol — all outside the traditional U.K. production hub in Southeast England. The goal is to educate new applicants, as well as to provide further opportunities for the guild’s current members.

While Britain continues to grow its below-the-line talent base, it’s doubtful the U.K. business will ever approach the size of Stateside production. Nonetheless, Blighty’s continued output of award-winning films and TV shows, and the strong presence of its actors and executives in Hollywood, are likely to ensure growing numbers in the simple equation: talent + incentives = production.

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