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UK And India Complete Film Co-Production Agreement

by Robert Lee, Tax-News.com, London

23 May 2008


The UK and Indian Governments have successfully completed negotiations which will enable a UK-India film co-production agreement to come into force, it emerged earlier this month.

As part of this work, UK Trade & Investment (UKTI) will also run a series of workshops for Indian filmmakers who are interested in co-producing with the UK and making use of the treaty.

The treaty will enable UK and Indian filmmakers to work together to co-produce films that will be eligible for national status in both countries.

The agreement provides an economic incentive for filmmakers to work together because it provides access to benefits of national status for the film. In the UK, joint-production films will qualify for the same tax breaks and grants as wholly British productions.

This means that films with a budget of less than GBP20mn will receive 20% tax relief, and larger productions will qualify for 16% tax relief. Producers will also get access to two funds run by the UK Film Council, worth GBP13mn.

As a direct result of the treaty, it is expected that 10 UK-Indian co-productions will be made within the first two years.

The four UKTI workshops will aim to provide all stakeholders – the national bodies, trade associations, individual production companies and professional advisers – with a better understanding of how the treaty will work and how potential co-producers can benefit from the same.

Secretary of State for Culture, Media and Sport Andy Burnham observed that:

“India and Britain both have vibrant film industries and bringing them together in this way opens the door to some exciting new collaborations. Our countries have close cultural and historical connections and it is great that our film industries will be able to work more closely together to develop this further."

John Woodward Chief Executive Officer of the UK Film Council stated, meanwhile, that:

“The UK and Indian film industries are among the most influential in the world and the aim of the treaty is to build on the existing cultural ties and encourage greater collaboration."

“Aside from the clear economic benefits to filmmakers the treaty also aims to increase the diversity of filmmaking giving filmmakers the opportunity to tell new stories that reflect our shared history and culture.”

Lord Digby Jones, UK Minister for Trade & Investment added:

“The UK and India have truly remarkable heritages in filmmaking and the UKTI workshops will bring together expertise from both. They will help forge relationships that will maximise the creative talent of UK and Indian filmmakers and give them the tools to enter into production partnerships."

“I am pleased that UKTI is taking practical steps to help kick start the UK-India film co-production agreement. The workshops will be the catalysts for the new financial and artistic opportunities that the agreement brings. Both countries can look forward to reaping the rewards – and I can’t wait to see the results on the big screen.”

In addition the treaty will contribute significantly to the strengthening of the skills base in both India and the UK.

A comprehensive report in our Intelligence Report series examining tax-sheltering arrangements for investors, including Venture Capital, Forest Finance, Film Finance, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report5.asp

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