The Strategic Advisory Board for Intellectual Property (SABIP) warned it may be hard to change attitudes.
The government says work must be done internationally to tackle the problem.
Intellectual Property Minister David Lammy said the report put into context the impact illegal downloads had on copyright industries and the UK economy as a whole.
But he added: "This is not an issue confined by national boundaries and I am sure that other [EU] member states and their copyright industries will find this report of use in the development of policy."
My feeling is that people in the UK feel a sense of entitlement to entertainment content because they already pay a television licence fee and most of the British entertainment industry is also heavily subsidised by the taxpayer.
If the government is serious about changing attitudes so the copyright holder is respected it must scrap the licence fee and allow the entertainment industry to flourish in the free market where the general public get to decide what they want to see (and therefore what gets made) rather than some unelected quango (aka Mark Thompson).