UK Film Studios Put Property Tax Bombshell On Culture Secretary’s Radar As Sunset Studios Pauses $900M British Expansion Amid Uncertainty

UniqueSome of Britain̵7;s top film and TV studios raise concerns with culture secretary lucy fraser more than one property tax bomb which has been put on the brakes this week Sunset Studio‘Big expansion into the British market.

Deadline understands Fraser has held talks with industry representatives about a potentially surprising increase in business rates. Sources said she was keen to avoid damaging Britain’s world-leading production facilities.

The Treasury takes the lead on tax matters, so eventually Chancellor Jeremy Hunt will have to step in, but Fraser could be an important advocate for the renegotiation. Hunt himself is a former Culture Secretary and has supported the UK’s creative industries.

Political interest in the issue has surfaced in the form of Sunset Studio Waltham Cross, £700M ($900M) studio development in Hertfordshire, has been put on hold amid uncertainty over property tax. The development is an expansion of Sunset’s facility in California, which shoots including Oscar-winning La la Land,

Deadline understands that Blackstone and Hudson Pacific, which own Sunset Studios, are still planning to build on Waltham Cross, but are putting it on hold until there is more clarity on property tax concerns. Rising inflation in Britain has also been one of the reasons for the decision to stop digging.

Construction was due to begin shortly and it is not clear how long the project will be delayed. construction inquirer Sources have been quoted as saying that it may take 2024 to start the work. Blackstone and Hudson Pacific declined to comment.

In April, the U.K. The Valuation Office Agency (VOA) updated the “rateable values” of UK studios. An estimate of the annual rental value of a property if it were available on the open market.

Rateable values ​​are used to calculate business rates, taxes on non-domestic properties. The higher the assessable value, the higher the business rate tax.

Pinewood StudioWhere James Bond is filmed, its rateable value has quadrupled to £16.2 million on 1 April. warner brothers, Studio Leavesden, Home of HBO dragon househas seen its asking price rocket five-fold to £25.3M.

fir wood is one of the studios lobbying against the changes, while Deadline understands Netflix is ​​also being represented. The British Film Commission is helping to coordinate the efforts.

Industry insiders warn that higher property taxes will threaten investment in new facilities at a time when studio space is at a premium. One observer said it was “sad timing” that the issue had affected the production of Sunset Studios.

Other developers have raised concerns. Giles Dobson, partner at property consultancy Bidwells, which developed Hertswood Studios in Hertfordshire, said earlier this year: “The rise in UK property taxes threatens to end the UK’s position as a global center for the entertainment industry.”

VOA is continuing to assess the issue and is conducting inspections at UK studios. It is not clear whether a solution will be found. VOA has been contacted for comment.

The Treasury is providing £13.6B of business rate relief to companies in need of support, but declined to comment on whether this included any UK studios.

A Treasury spokesman said: “The UK is Europe’s largest TV and film industry and we want to continue that growth with new audio and visual expenditure tax credits and relief to allow production companies to claim corporation tax deductions.” Have been.”

Elsewhere, Hertsmere Borough Council, owner of Elstree Studios, has warned that the facility needs up to £200M of redevelopment funding following the discovery of asbestos in the sound stages. Elstree is home Crown and Star Wars.