The Hollywood studio behind the three latest Mission: Impossible movies has been handed £137.3 million of UK taxpayers’ cash to help fund their production, an investigation for the Standard has found.
Last month Paramount Global - which owns Channel 5 in the UK - released the first trailer for the eighth instalment of Tom Cruise’s super spy series which will be released in May next year.
Called Mission: Impossible – The Final Reckoning, it also stars Hayley Atwell and Simon Pegg in a high-stakes game of espionage stretching from South Africa to Malta and Norway.
The movie was actually filmed in the far less glamorous location of Longcross Studios in Surrey which was also home to its prequel Mission: Impossible – Dead Reckoning Part One. It was a dream ticket for Hollywood giant Paramount which is in the process of an $8 billion (£6.3 billion) merger with Skydance, a company set up by the son of Silicon Valley mogul Larry Ellison.
Studios that film in the UK benefit from the government’s Audio-Visual Expenditure Credit (AVEC) which gives them a cash tax credit of up to 25.5% of the money they spend there.
To qualify for the reimbursement, at least 10% of the production costs need to relate to activities in the UK. In order to demonstrate this to the government, studios set up separate production companies in the UK for each movie they make there.
Accounts for these companies shine a spotlight on the otherwise secretive costs of blockbuster movie-making. Budgets of movies are usually confidential as studios combine the cost of them in their overall expenses and do not itemise how much they spent on each one. Movies made in the UK are exceptions as the UK production companies have to file accounts.
The companies usually have code names so they do not raise attention with fans when filing for permits to film on location. The three latest Mission: Impossible movies were made by a company called Jupiter Spring Productions, one of Paramount’s UK subsidiaries.
The accounts show that since the company was founded in 2016 it has spent a staggering £847.9 million on making The Final Reckoning, Dead Reckoning and its predecessor, 2018’s Mission: Impossible Fallout.
The costs peaked at £177.7m in 2022 when production of Dead Reckoning was in full swing. The company’s spending is set to surge as filming on next year’s movie only finished this month.
The accounts reveal that the blockbuster costs were partly offset by £57 million of insurance payouts and £1.4 million of government grants due to disruption by the pandemic which led to production of Dead Reckoning being shut down several times. In 2020 Cruise was famously heard in leaked audio shouting at crew members on set for breaking Covid safety protocols by standing too close to each other.
However, Jupiter Spring’s biggest handout has been the £137.3 million of tax credits since 2016. These peaked at £30.3 million in 2021 but were £25.1 million in 2023 and £27.6 million in 2022.
The enormous scale of the tax credits has raised eyebrows as Paramount reported adjusted income of £679.5m ($858m) on £5.3bn ($6.7bn) of revenue in its latest quarter alone.
John O’Connell, chief executive of the lobby group the TaxPayers’ Alliance, said; “Inward investment is a major boon for the UK but the right balance must be struck. It’s vital to drastically simplify the tax system to make it much easier to understand, while eliminating carve outs and reliefs so that everyone is on a level playing field.”
The UK benefits from movie studios spending on services such as equipment hire, travel and visual effects firms. Filming also drives employment and Jupiter Spring has spent a total of £46.8 million on staff with the workforce peaking at 414 in 2021.
The Mission: Impossible franchise starring Cruise as agent Ethan Hunt has been running since 1996 and has grossed more than $4 billion at the box office worldwide, making it the 17th biggerst grossing film franchise.
No-one at Paramount was available for comment.
