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BSkyB study finds the broadcaster "contributes £5.4bn to UK economy"

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By The Drum, Editorial

July 6, 2012 | 2 min read

Following an independent report into its economic impact BskyB has claimed it contributes £5.4 billion to the UK’s GDP.

The publication, timed to coincide with Ofcom’s investigation into whether the company is a “fit and proper” owner of a broadcasting licence, also showed BskyB supports 120,000 jobs and makes £2.3 billion in tax contributions.

The 24-page report says BskyB generated “considerable” tax revenue of £911 million in 2011 - £337 million through corporation tax and business rates and £604 million through customers’ VAT payments and staff’s employment taxes. BskyB argues that is tax contribution is “relatively large to other similarly sized corporates operating in the UK” as its overall tax total was considered to be £2.3 billion.

The report claims the overall estimate of BskyB’s contribution to UK GDP last year was £5.4 billion, including a direct contribution of £2.2 billion.

Of its £6.4 billion revenue Sky says 75 per cent of that was spent on services in the UK and claims its £3.2 billion investment in digital TV services such as, HD, Sky+ and 3D has prompted rivals to innovate. High spends on sport – premier league rights are almost £2 billion over three years – have a positive outcome for the company as it results in work for 645 suppliers in production and Sky’s entertainment rights also result in work for 110 production companies.

The report also found Sky employs as many people as Rolls-Royce and IBM UK – around 22,800 in full- or part-time roles – and through supply chains this number grows to around 118,600 jobs supported by Sky.

BskyB chief executive, Jeremy Darroch, last week commented: “We hope that Sky's story provides a good example of the important contribution that a successful British company can make, particularly at a time when economic growth is harder to come by.”

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