British film funding crisis

Keira Knightley was lined up to star alongside Jude Law

The British film industry is facing a growing funding crisis as it emerged that up to 40 movies may have to be scrapped because of sudden Treasury moves to change the tax laws.

Dozens of films have been plunged into uncertainty after the Inland Revenue moved without warning to block a tax loophole used by funding agencies to raise millions to finance British films.

The move means 25 to 40 films poised to start shooting are faced with an overnight loss of 30 per cent of their budgets. And the Film Council is pleading with the Treasury to give the industry breathing space.

Director Gaby Dellal, who saw £1 million in funding disappear from her film On A Clear Day, said: "The Inland Revenue has replaced a loophole with a black hole. It is a desperate situation." Among the films already hit by the new ruling are Tulip Fever, directed by Shakespeare In Love's John Madden, which was cancelled after it lost 30 per cent of its financing overnight.

Producer Alison Owen is applying for emergency Lottery funding in a last ditch effort to save the film, which stars Jude Law and Keira Knightley.

Other films are hanging in the balance: The Truth About Love, a romantic comedy starring Dougray Scott and Jennifer Love Hewitt being shot in Bristol, has continued only because the crew have been working for free while its producer Tracey Adam has taken out a personal loan in an attempt to save her film.

Man To Man, a drama about the discover of the missing link staring Kristin Scott Thomas and Joseph Fiennes being shot in South Africa is also gambling on a last minute reprieve from the Treasury and gone ahead - even though it too has lost huge chunk of its budget. One high-profile film, The Libertine, has deserted mainland Britain altogether in favour of offshore haven the Isle of Man after film officials there agreed to finance 25 per cent of the £10 million production.

It stars two actors in huge demand - Oscar nominees Johnny Depp and Samantha Morton - and producers feared the stars would not have been able to fit a delayed shoot into their schedules.

Its producer John Malkovich described the taxman's decision as "a big blow", adding: "To get someone like Johnny to do it takes a long time, for example, and it's not an easy film to get financed."

The film industry will have to wait until the Budget on 17 March to learn whether Gordon Brown plans to help. But Hollywood studio bosses have already sent out an ominous warning. Miramax's Colin Vaines said: "Miramax and other US majors such as Warner Brothers, which makes Harry Potter, and Universal, which is behind James Bond, will take the bulk of their productions to Canada, Germany or Hungary, where tax breaks are becoming more favourable."

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in