Institutions – Lithuania
Country Focus: Lithuania
Lithuanian Parliament approves new tax incentives
- New tax breaks hoped to appeal to both domestic and foreign producers in Lithuania
The Lithuanian Parliament has approved amendments to the law that would allow both foreign and local producers to take advantage of new tax incentives. The move will see Lithuania go some way in attempting to emulate the success of its Baltic cousins in Latvia, hugely successful in attracting foreign productions to the area, and Estonia’s recently set-up film commission and new regional film fund.
The scheme will see Lithuanian corporate tax relief granted to a Lithuanian or foreign entity acting through a permanent office that has provided a donation to a film producer for the production of a film in Lithuania. The relief will be provided on the proviso that at least 80% of all the expenses for the film or its part production are incurred in the Republic of Lithuania and the expenses incurred in the Republic of Lithuania are at least LTL 150 000 (43 443 EUR) and the aggregate maximum amount of the donation funds provided does not exceed 20% of the production costs of the film .
The Lithuanian Film Centre will administer the scheme which will start operating from January 1, 2014 and will run until December 31, 2018.
Jurate Pazikaité, the director of Vilnius Film Office, said: "When a similar law incentive took effect in Hungary, foreign films produced in the country have increased seven-fold. Within five years, film production grew by a hundred million Litas. Latvia is the only country among our neighbors that has a similar tax exemption and with which we currently compete. It still has a competitive advantage because such an incentive is already in effect. After the approval of this amendment, Vilnius would become a great centre of attraction for films from both Hollywood andother European countries. We are grateful to the Ministry of Finance for having the courage to take these vital measures necessary for our film industry."
Kęstutis Drazdauskas, chairman of the Independent Producers Association of Lithuania, said: "It is very important because this system will attract private Lithuanian investors to film production too. Such an amendment would help Lithuanian film makers find partners abroad to co-produce films."
Did you enjoy reading this article? Please subscribe to our newsletter to receive more stories like this directly in your inbox.