Eady Levy facts for kids

The Eady Levy was a special tax on movie tickets in the United Kingdom. It was created to help the British film industry make more movies. This tax started in 1950 and was named after Sir Wilfred Griffin Eady, a government official. The money collected went into a fund called the British Film Production Fund. At first, paying the tax was optional, but it became required in 1957. The Eady Levy finally ended in 1985.

Why Was the Eady Levy Created?

In 1949, a government official named Harold Wilson first suggested this tax. The main goal was to support people who made British films. If the government had just given money directly to filmmakers, it would have been called a subsidy. This could have caused problems with other countries, especially American film producers, because of international trade rules.

The Eady Levy was a clever way around this. By collecting money from ticket sales, it was an indirect way to help. This meant the UK film industry could get extra funding without upsetting other countries.

How Did the Eady Levy Work?

The Eady Levy officially began on September 9, 1950. Initially, movie theaters could choose whether to pay it or not. However, by 1953, the UK government said they would make it a law if theaters didn't agree to continue paying. It became a legal requirement in 1957 through a law called the Cinematograph Films Act 1957.

Here's how the money was handled:

• A part of each movie ticket price was put into a special fund.
• Half of this money went back to the movie theaters. This was like a small refund for them.
• The other half was given to films that qualified as 'British'. The more money a British film made at the box office, the more money it received from the fund.
• The money was collected by HM Customs and Excise, which is a government department. A group called the British Film Fund Agency managed how the money was given out.

To be considered a 'British film' and get money from the levy, a movie had to meet certain rules:

• At least 85% of the film had to be shot in the United Kingdom or other Commonwealth countries.
• Only three non-British people could be paid for their work on the film. This rule made sure that British actors, technicians, and film crews were hired.

In its first year, the tax was very small: a quarter of a penny (1⁄4d) per ticket. It raised about $3 million. In the second year, for tickets costing more than 12 pence, the tax tripled to three-quarters of a penny (3⁄4d). This raised about £3 million ($8.4 million) each year.

What Was the Eady Levy's Effect?

The Eady Levy helped the British film industry a lot. It also reduced the impact of another tax, called entertainment tax, which movie theaters didn't like.

During the 1960s, British cinema became very popular. Many famous films, including the James Bond films, were made. A big reason for this was the Eady Levy. It also helped that making movies in the UK was cheaper than in other countries. This meant filmmakers could get the same quality for less money.

Because of these benefits, many American filmmakers came to work in Britain. Some, like Sidney Lumet, Stanley Donen, and John Huston, stayed for a long time. Stanley Kubrick moved to Britain in the early 1960s and made famous movies like Lolita (1962) and 2001: A Space Odyssey (1968) there. Another American director, Richard Lester, directed The Beatles' films A Hard Day's Night (1964) and Help! (1965).

It wasn't just American directors who came. Famous European directors also made films in Britain. These included Roman Polanski and François Truffaut, who filmed Fahrenheit 451 in England.

The Eady Levy also provided money for the National Film and Television School. This school trained many directors and actors who are still working in the film industry today.

Why Did the Eady Levy End?

The Eady Levy was created to support British film production. However, by 1984, the British Government realized it wasn't working as planned. A lot of the money was going to film distributors (companies that send films to cinemas) instead of the people who actually made the movies. It also became a heavy burden on movie theaters.

In 1984, fewer people went to the cinema in the UK than ever before. Only 54 million tickets were sold that year, which was less than one ticket per person in the country. This was mainly because of new competition from TV and home video players. The Eady Levy was adding to the financial problems of movie theater chains. Because of these reasons, the Eady Levy was stopped in 1985.