Changes to tax breaks
The new French system of tax relief for film productions is being prepared for launch on January 1, 2004. The changes have the support of the Prime Minister, Jean-Pierre Raffarin and the Minister of Culture, Jean-Jacques Aillagon. After considering the introduction of a leasing system, the public administration has finally opted for a more classic formula of tax credits.
The French tax breaks aim to re-invigorate funding for the cinematographic industry and to stem the current flow of film sets moving abroad. The hope is that the new system will offer equally advantageous terms and conditions for productions as those available in Ireland, Britain, Belgium and Luxembourg.
There will, however, be changes to the way these funds can be used, the precise details of which are being worked on by the Ministry of Culture. The original idea for the leasing system, which is currently in place for the construction of planes and boats, was deemed to be too complicated and less competitive when compared with the tax break systems set up by other EU countries. So they have chosen to introduce a system of tax credits for French film production, worth a total of €23m. Budgets for shooting and post production (excluding actors’ fees) for films made in France will be given a tax credit worth 15-20% (in the form of a refund) up to a maximum figure equivalent to a third of the film’s total budget, with the maximum credit set at €500,000.
The new changes will be put the vote in parliament, when the next financial legislation is to be debated.
(Translated from French)
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