Netflix Draws U.K. Flak, Told to Admit ‘The Crown’ Is Fiction … and Pay Its Taxes

The Crown
(Image credit: Netflix)

Netflix had a rather turbulent Thanksgiving holiday in the United Kingdom, receiving slaps on the wrist for how it bills its hit original series The Crown, as well as how it reports its revenue in the region.

Speaking to local paper The Mail, U.K. Culture Secretary Oliver Dowden called on the streaming service to address historical fabrications in The Crown, a Left Bank Pictures-produced period drama that tracks the lives of more recent British royalty.

“It’s a beautifully produced work of fiction, so as with other TV productions, Netflix should be very clear at the beginning that it is just that,” Dowden told The Mail. “Without this, I fear a generation of viewers who did not live through these events may mistake fiction for fact.”

Dowden said he planned to follow up with Netflix this week. 

The growing clamor in the U.K. for Netflix to more clearly delineate when The Crown head writer Peter Morgan and his team are taking creative license comes as think tank Tax Watch reports that Netflix is significantly under-reporting its revenue in the UK. 

Through holding company Netflix Services UK, the streaming company reported 2018 revenue of just $57 million (U.S.). It gets complicated, because the holding company also provides services to Netherlands-based Netflix International.

Tax Watch said that Netflix’s real U.K. revenue for 2018 is closer to $1.1 billion. 

Netflix responded by saying that U.K. revenue will more directly broken out in future earnings reports. 

“As Netflix continues to grow in the U.K. and in other international markets we want our corporate structure to reflect this footprint,” a Netflix spokesman told The Guardian. “So from next year, revenue generated in the UK will be recognized in the U.K., and we will pay corporate income tax accordingly.”

Daniel Frankel

Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!