A review of the possible impact on the Irish audiovisual industry following Britain’s plans to introduce a tax incentive for TV dramas has been ordered by Minister For Arts, Heritage and the Gaeltacht Jimmy Deenihan.
The review will be carried out by the Irish Film Board and has been welcomed as a “very, very positive” move by the Audiovisual Federation, the IBEC group that represents Ireland's feature film, television and animation sectors.
Last month, Britain announced in its budget that it planned to extend its tax incentives for film productions to also include TV production. It is thought the incentive will be worth 25 per cent and could be in place by April 2013.
Ireland’s current tax incentive of 28 per cent to film and TV drama has led to a recent surge in British TV productions here. This year alone the BBC is spending around €13m on three major drama series in Dublin, ‘Ripper Street’, ‘Loving Miss Hatto’ and the second series of ‘Vexed’.
Minister Deenihan announced details of the review in response to a parliamentary question by Fine Gael TD Seán Kyne saying: “I have asked the Irish Film Board to provide an analysis of the likely impact of the proposed move by the UK Treasury.”
In a separate move, Minister For Finance Michael Noonan also announced that his department will also review the section 481 tax incentives.
He said: “I have asked my Department to undertake a review later this year in order to inform future policy making in relation to the scheme. I do not intend to make any major adjustments to the scheme prior to the completion of this review.”
Both Ministers were responding to a question from Deputy Kyne as to whether they had considered the potential impact on Ireland of British tax incentives.
Speaking to IFTN, Ibec’s audiovisual federation director Torlach Denihan said the group hoped to have an input into the Irish Film Board’s review and hoped that the review would examine the “competitiveness issue” of the Irish industry.
He said that the devaluation of Sterling against the Euro had “put pressure” on the audiovisual industry in the past, but that that had been largely offset by the fact that Britain had no similar initiative to Section 481 for the TV industry.
Denihan added that more tax incentives or an expansion of 481 “would not necessarily be top of the list,” adding that labour costs, skills, facilities should be examined.
He said: “We have got to face up to our labour costs. Our labour costs are up to 30 per cent out of line with the equivalent labour costs in the UK in the film and TV production sector. That’s something that does need to be looked at with urgency.
“Work has been done in that area. An agreement has been put in place with Siptu and, as I understand it, discussions are at an advanced stage with the construction unions. But something definitely does need to be done with regard the electricians sector.”
Denihan added of the Minister’s proposed review: “There was a very good basis of information that was assembled for the preparation of the Creative Capital Report (2011), so I think that a lot of the raw material in terms of what’s needed for further analysis has already been assembled.”