Government approves extension to tax deductions for film
by Sergio Ríos Pérez
04/07/2011 - On Friday, July 1, the Council of Ministers approved the extension to the 18% tax deductions for film production, which were due to expire on December 31 of this year. This show of confidence towards the presence of the private sector in cinema, despite the difficult economic climate that Spain is experiencing (see news), has been welcomed with open arms by the industry. In a statement, FAPAE (Federation of Audiovisual Producers Associations) said that this measure “brings necessary stability to the audiovisual sector”.
Since their introduction at the end of 2007 as part of the Film Law, the tax deductions have “helped improve the industrial fabric of this sector thanks to the incorporation of Economic Interest Groups (EIG)”, according to the press release issued by the Culture Ministry, which describes the effects on Spanish filmmaking as “wonderful”.
There are currently 30 production companies registered as EIGs. Since 2008, the number of films produced through this system has increased significantly, from four in its first year to 13 in 2010. It has given rise to films including The Oxford Murders [trailer, film focus], Cell 211 [trailer, film focus], Oscar-winner The Secret In Their Eyes [trailer] and Even the Rain [trailer, film focus]. In 2009, films produced by EIGs accounted for 26% of box office takings for Spanish films.
The entry of the private sector into Spanish film financing has for some time been one of the major aims of the industry, which has seen its traditional financing sources gradually diminish both in number and percentage of investment (see news).
(Translated from Spanish)