Arts and culture sector welcomes extension of tax relief in the Budget

The arts and culture sector has welcomed the Chancellor’s announcement of a tax relief extension in the Budget, but said the Government must go further to aid its post-lockdown recovery.

© Matt Crockett
(Matt Crockett/PA)

Rishi Sunak said tax relief for theatres, orchestras, museums and galleries will be extended for two years, to March 2024, in order to help them rally after months of closures and lost revenue.

Up to £2 million will also be invested in a new Beatles attraction on the Liverpool Waterfront, he said.

Culture Secretary Nadine Dorries welcomed the news with a pun-filled post on social media.

“Oh! Darling. The government has Come Together to invest £2 million into a major new Beatles attraction,” she said.

“With a Little Help from My Friends at @hmtreasury and taxpayers support, we’re getting the waterfront development in Liverpool going. That’s something to Twist and Shout about.”

Maria Balshaw, director of the Tate art museums and galleries and chairwoman of the National Museum Directors’ Council, celebrated the tax relief extension.

“It’s great to hear the Government showing such strong support for the arts,” she said in a statement.

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The Tate Modern in London (Tim Ireland/PA)

“I’m particularly grateful to see the extension of tax relief that has already made a huge difference for the sector, and much-needed investment in the public museum buildings, which make up such a vital part of our cultural infrastructure.

“As we emerge from the pandemic, national museums like Tate and our powerful regional museums can and will play a transformative role in cities and towns throughout the country. The UK-wide ecology of museums and galleries will be essential for rebuilding social wellbeing and inspiring new generations of visitors.”

Julian Bird, chief executive of Society of London Theatre and UK Theatre, also welcomed the measures.

He said the increase in rates of relief for theatre tax will “provide producers and investors with greater confidence in developing our world-leading theatre and drive the cultural recovery from the pandemic”.

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Chancellor of the Exchequer Rishi Sunak (Victoria Jones/PA)

Mr Bird added the “welcome news that core funding for the Department of Digital, Culture, Media and Sport and Local Authorities is set to increase will reassure the venues and performing arts companies up and down the country that rely on their support in delivering culture to their local communities”.

The chief executive of industry body UK Music, Jamie Njoku-Goodwin, said “further action” was needed “to support the music sector’s post-pandemic recovery”.

Mr Njoku-Goodwin added: “Covid halved music’s economic contribution to the UK economy from almost £6 billion a year to £3.1 billion in 2020. If the Government strikes the right note by delivering the support we need, our music industry will come back stronger and bigger than ever.

“We are pleased to see the extension of the orchestras tax relief yet the Government has missed an opportunity to not take forward further music tax incentives to help boost jobs and economic growth. Similarly, business rate relief for venues is very welcome yet we remain concerned about next April’s VAT hike for live events.

“Ministers must put turbo-chargers under the efforts to clear away the barriers that are still making it so hard and expensive for musicians and crew to tour easily in the EU.”

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The Royal Philharmonic Orchestra’s managing director James Williams (RPO/PA)

The Royal Philharmonic Orchestra, the associate orchestra of London’s Royal Albert Hall, also welcomed the two-year extension of tax relief.

Its managing director James Williams said: “After a protracted period of venue closure during the succession of lockdowns, there is a major task ahead to rebuild consumer confidence in returning to the concert hall.

“At the Royal Philharmonic Orchestra, we are committed to enriching society by fully maximising access to orchestral music to the broadest possible audience. This involves regional touring outside London and investing in our community and education programmes.

“The Chancellor’s decision to extend tax relief will help our work as we contribute to the rebuilding of an inclusive society after the Covid lockdown era.”

Caroline Norbury, chief executive of the Creative Industries Federation, said the budget acknowledged the financial and social contribution of the sector over the last 20 years.

She said: “The recognition of this in today’s announcement – doubling tax relief for museums, galleries, theatres and orchestras, £850 million in post-pandemic support for culture and heritage institutions, and £14 million a year in scale-up funding for creative SMEs – is hugely welcome, supporting the cultural sector when most needed.

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Music fans at TRNSMT Festival (Lesley Martin/PA)

“However, the limited expansion of R&D tax relief – which continues to exclude many in our sector – is disappointing, as is the missing arts premium, an election manifesto commitment made only two years ago.

“The creative industries have the power to drive economic growth and regeneration across our country, and creative skills are vital for a future-proof workforce.

“Just as important as preserving our rich cultural heritage is recognising the crucial role our films, television, music, fashion and games and world-leading talent in front of and behind the cameras play in shaping our future economic success and recovery.”

Paul Pacifico, chief executive of the trade body Association of Independent Music, said the tax relief extension in the Budget was “encouraging” but called for a music industry-specific scheme.

He said: “It’s encouraging to see the Government recognise the serious blow Covid dealt to the UK’s music industry in today’s Budget, discounting business rates for music and other hospitality venues and for premises improvements and green tech use as well as increasing tax reliefs for orchestras.

“However, more must be done to support the globally significant independent music sector to ensure a viable future for diverse music, creators and entrepreneurs.

“One key proposal is a tax relief scheme for music, like those successfully implemented in other creative industries such as film and games.”