The government said it will broaden the scope of the museums and galleries tax relief announced at Budget 2016 to include permanent exhibitions so that it is accessible to a wider range of institutions across the country.

The rates of relief will be set at 25% for touring exhibitions and 20% for non-touring exhibitions and the relief will be capped at £500,000 of qualifying expenditure per exhibition.

The relief will take effect from 1 April 2017, with a sunset clause which means the relief will expire in April 2022 if not renewed. In 2020, the government will review the tax relief and set out plans beyond 2022.

According to costings set out in the Autumn Statement document, the government expects the measure to cost £5m in 2017/18 and £30m per year thereafter.

The museums and galleries tax relief will follow the same model as the existing creative industries tax reliefs. These include the film tax relief, which has paid out over £1.8bn in respect of 1,800 claims since its introduction in 2007, and the high-end television tax relief, which has paid out over £200m in respect of 145 claims since its introduction in 2014.

Similar provisions have been put in place for theatres and orchestra.

Rachel Austin, tax director at Deloitte, said: ‘The extension will benefit many smaller museums and galleries, which do not have temporary exhibition spaces or regularly changing exhibitions.

‘Less welcome will be the £500,000 cap on qualifying expenditure per exhibition, especially for larger national museums and galleries. The National Museum Directors’ Council estimates that the extension to permanent exhibitions would provide additional tax relief of around £3.5m per annum. The government has introduced the cap to keep the total cost at £30m per annum.’