Extend tax relief for theatres and orchestras, says Robertson

Scotland’s Culture Secretary Angus Robertson has called on the UK Government to extend its higher rate of tax relief for theatres and orchestras by a year.

In a letter addressed to Chancellor Jeremy Hunt, Robertson said reducing the current rate from April 2023 as planned will “result in severe damage to Scotland’s cultural ecosystem”.

Hunt announced a temporary increase in the rate of certain creative sector tax reliefs as part of his Autumn Budget Statement.

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Theatre Tax Relief, which offers theatre companies a tax rebate against the money spent on a production, was increased to 45% for non-touring productions until 31 March 2023. The government's plans will see it then reduced to 30% for the following year, before returning to 20% from 1 April 2024.

In the Autumn Statement, Theatre Tax Relief for touring theatre productions was increased to 50% until 31 March 2023, before being set at 35% for the following year and returning to 25% in April 2024. These are the same rates that apply for Orchestra Tax Relief, which offers a tax rebate against the money spent on the production of an orchestral concert.

In his letter to Hunt, Robertson says concerns over the forthcoming decreases have been raised frequently by cultural venues during roundtable discussions he has convened in Scotland.

“Our Scottish cultural stakeholders have told us that the additional tax support has been a lifeline during these difficult times and that decreasing this support at a time when the sector is still facing increased costs is likely to result in severe damage to Scotland’s cultural ecosystem,” he says.

Cultural Secretary Michelle Donelan met with Robertson in December to discuss the concerns.

According to Robertson’s letter, Donelan was “cognisant of this issue” and recommended he wrote to Hunt directly to “reiterate the importance of extending the increased rate of tax relief at this time”.

In his letter, Robertson suggests extending the current rate of tax relief through to March 2024, citing the Bank of England's prediction of a two-year economic downturn following annoucement of a recession in November.

“I do hope that you understand the importance of supporting our vibrant culture sector during this difficult time and put in place an extension to the additional tax relief support,” Robertson’s letter concludes.