Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential impact of changes to orchestral tax relief on touring orchestras’ ability to fund UK charity concerts and community programmes.

The UK provides world-leading support for orchestras: at Autumn Budget 2024, the Government confirmed that from 1 April 2025, the rate of Orchestra Tax Relief (OTR) will be set at the generous rate of 45%.

From April 2024, qualifying expenditure is expenditure incurred on goods or services that are ‘used or consumed in the UK’, replacing the previous rule that qualifying costs were those incurred on goods and services provided from the UK or EEA.  To ease the transition to the new rule, orchestras with concerts in train on 1 April 2024 were permitted to continue claiming relief on goods and services provided from within the EEA until 31 March 2025.

It is appropriate to refocus orchestra tax relief on UK expenditure now that the UK has left the EU. Under the new rule, the relief incentivises activity within the UK, rather than the UK and the EEA. This does not prevent qualifying productions from touring in the EEA (nor elsewhere).

As with all tax policy changes, a Tax Information and Impact Note was published in 2023 which can be found here: Administrative changes to the creative industry tax reliefs - GOV.UK.