Budget: 'Commitment to support media' offered by Budget says Grant Thornton head of media tax
Today’s budget announcement offers a 'commitment to support’ the media sector says Grant Thornton’s head of media tax, Liz Brion.
In reaction to today’s budget by Chancellor George Osbourne, who announced several tax incentives, including a reduction in corporation tax, Brion said that she believed it could be a strong enough incentive to lure back significant media companies, such as WPP, and compete to bring other international company headquarters to Britain.
“As ever though, we need to see the detail of the proposed changes to get a real sense of just how effective they are. The migration of companies out of the UK is an increasingly big problem in the media sector and any steps taken to curb this ‘brain drain’, by making the system simpler and more beneficial is welcome to keep our industry talent in the UK. Reducing some complexity in the tax law is a good signal to send as part of the Government's plan to make the UK a great place to be for business. The question is whether these changes will be enough for companies with migration plans to stop in their tracks or do a u-turn and come back to the UK,” she continued.
Despite this, Brion said she was not convinced that Osbourne had done enough to encourage the movie of intellectual property back to the UK.
”The ‘patent box’ extension with a 10% rate of corporation tax on income from patent rights, which was announced under the Labour Government in the 2009 Pre-Budget Report, is not wide enough as it does not include brands and trademarks otherwise known as “intangible assets.” In comparison Hong Kong, a traditionally low corporate tax rate area, has already announced that intangible assets do include brands and hallmarks. Inclusion of this step in the Budget, coupled with the other changes, could have made a real difference,” Brion concluded.