Since HMRC introduced the Museums & Galleries Exhibition Tax Relief in 2017, there has been relatively low take-up. In 2018-19, 50 claims supporting 300 exhibitions were made, receiving a total of £4m – an encouraging figure but a much lower amount than the £30m a year budgeted for by the Treasury.
“The figures look promising but they could be higher,” says Alistair Brown, policy manager at the Museums Association, which was one of the sector bodies involved in securing the relief. “We want to ensure that everyone who’s eligible is taking up the opportunity.”
The tax relief applies to production costs for touring, permanent and temporary exhibitions. Non-touring exhibitions can claim 20% of qualifying expenditure, with claims capped at £80,000 per exhibition, while touring exhibitions can claim 25% of qualifying expenditure, with a cap of £100,000 per exhibition, per venue. Up to £500,000 of relief on exhibitions can be claimed each financial year.
Policymakers are concerned that the relief may be dropped if it is not seen to be fulfilling its purpose; among the eight creative sector reliefs introduced in recent years, it is the only one to include a sunset clause that could see it expire in 2022. This was probably included because the relief is “a bit experimental”, says Brown. “We need to demonstrate that it does work, and it is meeting its policy goals.”
The slow rate of claims is likely to be because it is simply taking time for museums to get into the habit of using the relief, adds Brown. But take-up has also been hampered by some of the complexities involved in the process.
University of Cambridge Museums made a successful claim of £386,746 in July. Jo McPhee, head of University of Cambridge Museums Programmes, says: “The money generated through exhibition tax relief is enabling us to programme and produce exhibitions over the coming years that will play a significant role in bringing internationally excellent exhibitions to wider and more diverse audiences.”
But she agrees the process needs to be simpler. “The work involved in performing separate calculations for each exhibition can pose barriers for some smaller museums making the claims, and any simplifications to the scheme would be welcome including, for example, allowing a season of exhibitions of up to 12 months to be grouped together as a single trade.”