Eady levy
Encyclopedia
The Eady Levy was a tax
on box office
receipts in the United Kingdom
, intended to support the British film industry and named for Sir Wilfred Eady
. It was established in 1957 and terminated in 1985.
was first proposed by Harold Wilson
, then president of the Board of Trade, in 1949. The levy was intended to assist producers of British film
. A direct governmental payment to British-based producers would have qualified as a subsidy
under the terms of the General Agreement on Tariffs and Trade
, and would have led to objections from American film producers
. An indirect levy did not qualify as a subsidy, and so was a suitable way of providing additional funding for the UK film industry whilst avoiding criticism from abroad.
industry was opposed.
In the Eady Levy, a proportion of the ticket price was to be pooled — half to be retained by exhibitors (i.e., effectively a rebate
on the tax) and half to be divided among qualifying 'British' films in proportion to UK box office revenue, with no obligation to invest in further production. The Finance Bill (1950) had previously made the necessary changes in the Entertainments tax. The levy was collected by HM Customs and Excise and administered by the British Film Fund Agency.
The rise in British cinema (including the James Bond
movies) during the 1960s caused by an influx of American producers can be attributed to the Eady Levy - and also to the cheaper production facilities - making it cost far less in the UK to achieve the same quality of production. A number of American film makers worked in Britain in this period on a near-permanent basis, including Sidney Lumet
, Stanley Donen
, and John Huston
. Stanley Kubrick
moved to Britain in the early sixties to make Lolita
, Dr. Strangelove, 2001: A Space Odyssey
and A Clockwork Orange
amongst others. Another expatriate American, Richard Lester, directed The Beatles
' films A Hard Day's Night
and Help!
.
It was not only American film makers who came; a number of distinguished European directors also made films in Britain. These included Roman Polanski
, François Truffaut
(who made Fahrenheit 451
) and Jean-Luc Godard
.
The Eady Levy also provided funding for the National Film and Television School
, which trained a number of directors and actors still in work today. It also provided funding for the boost of the British pornographic film
industry through the 1970s
in 1984, the British Government recognised that the levy was no longer fulfilling its original purpose, with much of the payment going directly to distributors rather than producers, and proving an unreasonable burden on the exhibition sector. The Eady Levy was terminated in 1985.
Tax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...
on box office
Box office
A box office is a place where tickets are sold to the public for admission to an event. Patrons may perform the transaction at a countertop, through an unblocked hole through a wall or window, or at a wicket....
receipts in the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
, intended to support the British film industry and named for Sir Wilfred Eady
Wilfred Griffin Eady
Sir Wilfred Griffin Eady GCMG, KCB, KBE, was a British Treasury official and diplomat.Eady was a British delegate to the Bretton Woods Conference of July 1944, in New Hampshire. The conference was to decide the post-war international financial system; it led to the International Monetary Fund and...
. It was established in 1957 and terminated in 1985.
Background
A levyTax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...
was first proposed by Harold Wilson
Harold Wilson
James Harold Wilson, Baron Wilson of Rievaulx, KG, OBE, FRS, FSS, PC was a British Labour Member of Parliament, Leader of the Labour Party. He was twice Prime Minister of the United Kingdom during the 1960s and 1970s, winning four general elections, including a minority government after the...
, then president of the Board of Trade, in 1949. The levy was intended to assist producers of British film
Cinema of the United Kingdom
The United Kingdom has had a major influence on modern cinema. The first moving pictures developed on celluloid film were made in Hyde Park, London in 1889 by William Friese Greene, a British inventor, who patented the process in 1890. It is generally regarded that the British film industry...
. A direct governmental payment to British-based producers would have qualified as a subsidy
Subsidy
A subsidy is an assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributors in an industry to prevent the decline of that industry or an increase in the prices of its products or simply to encourage it to hire more labor A subsidy (also...
under the terms of the General Agreement on Tariffs and Trade
General Agreement on Tariffs and Trade
The General Agreement on Tariffs and Trade was negotiated during the UN Conference on Trade and Employment and was the outcome of the failure of negotiating governments to create the International Trade Organization . GATT was signed in 1947 and lasted until 1993, when it was replaced by the World...
, and would have led to objections from American film producers
Cinema of the United States
The cinema of the United States, also known as Hollywood, has had a profound effect on cinema across the world since the early 20th century. Its history is sometimes separated into four main periods: the silent film era, classical Hollywood cinema, New Hollywood, and the contemporary period...
. An indirect levy did not qualify as a subsidy, and so was a suitable way of providing additional funding for the UK film industry whilst avoiding criticism from abroad.
The levy established
The Eady Levy came into effect on 9 September 1950 but was not established on a statutory basis until its incorporation in the Cinematograph Film Act of 1957. It had the effect of both assisting the film industry, and reducing the effect of Entertainment Tax on film exhibition, to which all the cinemaFilm
A film, also called a movie or motion picture, is a series of still or moving images. It is produced by recording photographic images with cameras, or by creating images using animation techniques or visual effects...
industry was opposed.
In the Eady Levy, a proportion of the ticket price was to be pooled — half to be retained by exhibitors (i.e., effectively a rebate
Rebate
Rebate can refer to:* Rebate or rabbet, a woodworking term for a groove* Film rebate, the term for the border around photographic film- Money :* Rebate , a type of sales promotion used in marketing* Tax rebate, a reduction in taxation demanded...
on the tax) and half to be divided among qualifying 'British' films in proportion to UK box office revenue, with no obligation to invest in further production. The Finance Bill (1950) had previously made the necessary changes in the Entertainments tax. The levy was collected by HM Customs and Excise and administered by the British Film Fund Agency.
The rise in British cinema (including the James Bond
James Bond
James Bond, code name 007, is a fictional character created in 1953 by writer Ian Fleming, who featured him in twelve novels and two short story collections. There have been a six other authors who wrote authorised Bond novels or novelizations after Fleming's death in 1964: Kingsley Amis,...
movies) during the 1960s caused by an influx of American producers can be attributed to the Eady Levy - and also to the cheaper production facilities - making it cost far less in the UK to achieve the same quality of production. A number of American film makers worked in Britain in this period on a near-permanent basis, including Sidney Lumet
Sidney Lumet
Sidney Lumet was an American director, producer and screenwriter with over 50 films to his credit. He was nominated for the Academy Award as Best Director for 12 Angry Men , Dog Day Afternoon , Network and The Verdict...
, Stanley Donen
Stanley Donen
Stanley Donen ; is an American film director and choreographer whose most celebrated works are Singin' in the Rain and On the Town, both of which he co-directed with Gene Kelly. His other noteworthy films include Royal Wedding, Seven Brides for Seven Brothers, Funny Face, Indiscreet, Damn...
, and John Huston
John Huston
John Marcellus Huston was an American film director, screenwriter and actor. He wrote most of the 37 feature films he directed, many of which are today considered classics: The Maltese Falcon , The Treasure of the Sierra Madre , Key Largo , The Asphalt Jungle , The African Queen , Moulin Rouge...
. Stanley Kubrick
Stanley Kubrick
Stanley Kubrick was an American film director, writer, producer, and photographer who lived in England during most of the last four decades of his career...
moved to Britain in the early sixties to make Lolita
Lolita (1962 film)
Lolita is a 1962 comedy-drama film by Stanley Kubrick based on the classic novel of the same title by Vladimir Nabokov. The film stars James Mason as Humbert Humbert, Sue Lyon as Dolores Haze and Shelley Winters as Charlotte Haze with Peter Sellers as Clare Quilty.Due to the MPAA's restrictions at...
, Dr. Strangelove, 2001: A Space Odyssey
2001: A Space Odyssey (film)
2001: A Space Odyssey is a 1968 epic science fiction film produced and directed by Stanley Kubrick, and co-written by Kubrick and Arthur C. Clarke, partially inspired by Clarke's short story The Sentinel...
and A Clockwork Orange
A Clockwork Orange (film)
A Clockwork Orange is a 1971 film adaptation of Anthony Burgess's 1962 novel of the same name. It was written, directed and produced by Stanley Kubrick...
amongst others. Another expatriate American, Richard Lester, directed The Beatles
The Beatles
The Beatles were an English rock band, active throughout the 1960s and one of the most commercially successful and critically acclaimed acts in the history of popular music. Formed in Liverpool, by 1962 the group consisted of John Lennon , Paul McCartney , George Harrison and Ringo Starr...
' films A Hard Day's Night
A Hard Day's Night (film)
A Hard Day's Night is a 1964 British black-and-white comedy film directed by Richard Lester and starring The Beatles—John Lennon, Paul McCartney, George Harrison and Ringo Starr—during the height of Beatlemania. It was written by Alun Owen and originally released by United Artists...
and Help!
Help! (film)
Help! is a 1965 film directed by Richard Lester, starring The Beatles—John Lennon, Paul McCartney, George Harrison and Ringo Starr—and featuring Leo McKern, Eleanor Bron, Victor Spinetti, John Bluthal, Roy Kinnear and Patrick Cargill. Help! was the second feature film made by the Beatles and is a...
.
It was not only American film makers who came; a number of distinguished European directors also made films in Britain. These included Roman Polanski
Roman Polanski
Roman Polanski is a French-Polish film director, producer, writer and actor. Having made films in Poland, Britain, France and the USA, he is considered one of the few "truly international filmmakers."...
, François Truffaut
François Truffaut
François Roland Truffaut was an influential film critic and filmmaker and one of the founders of the French New Wave. In a film career lasting over a quarter of a century, he remains an icon of the French film industry. He was also a screenwriter, producer, and actor working on over twenty-five...
(who made Fahrenheit 451
Fahrenheit 451 (1966 film)
Fahrenheit 451 is a 1966 film directed by François Truffaut, in his first colour film as well as his only English-language film. It is based on the novel of the same name by Ray Bradbury....
) and Jean-Luc Godard
Jean-Luc Godard
Jean-Luc Godard is a French-Swiss film director, screenwriter and film critic. He is often identified with the 1960s French film movement, French Nouvelle Vague, or "New Wave"....
.
The Eady Levy also provided funding for the National Film and Television School
National Film and Television School
The National Film and Television School was established in 1971 and is based at Beaconsfield Studios in Beaconsfield, Buckinghamshire, and it is located close to Pinewood Studios.-History:...
, which trained a number of directors and actors still in work today. It also provided funding for the boost of the British pornographic film
Pornography
Pornography or porn is the explicit portrayal of sexual subject matter for the purposes of sexual arousal and erotic satisfaction.Pornography may use any of a variety of media, ranging from books, magazines, postcards, photos, sculpture, drawing, painting, animation, sound recording, film, video,...
industry through the 1970s
Termination of the levy
The Eady Levy was a tax on box office receipts, and was intended to support UK film production. However, in a White PaperWhite paper
A white paper is an authoritative report or guide that helps solve a problem. White papers are used to educate readers and help people make decisions, and are often requested and used in politics, policy, business, and technical fields. In commercial use, the term has also come to refer to...
in 1984, the British Government recognised that the levy was no longer fulfilling its original purpose, with much of the payment going directly to distributors rather than producers, and proving an unreasonable burden on the exhibition sector. The Eady Levy was terminated in 1985.