Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the impact of the reduction from April 2023 of (a) Orchestra and (b) Theatre Tax Relief on the financial sustainability of the cultural sector.

The Government recognises the value of the UK’s world leading creative industries and arts sectors.

Since theatre tax relief (TTR) was introduced in 2014, £392 million of relief has been paid out, supporting 17,820 productions as of the year 2021-22. £62 million of orchestra tax relief (OTR) has been paid out since it was introduced in 2016, supporting 2,640 productions as of the year 2021-2022.

At Autumn Budget 2021, the Government temporarily increased the headline rates of TTR and OTR in recognition of the impact of the Covid-19 pandemic on these sectors. The headline rate of relief for TTR was increased from 20 per cent (for non-touring productions) and 25 per cent (for touring productions) to 45 per cent and 50 per cent. From 1 April 2023, the rates will be reduced to 30 per cent and 35 per cent and will return to 20 per cent and 25 per cent on 1 April 2024. The headline rate of OTR was temporarily increased from 25 per cent to 50 per cent, reducing to 35 per cent from 1 April 2023 and returning to 25 per cent on 1 April 2024.

Whilst the Government keeps all tax reliefs under review, the Government is not planning to expand the qualifying costs for OTR or TTR.