Blueprint Law - In the News

  • NEW PRODUCER REBATE FOR AUSTRALIAN FILM AND TV PRODUCTION
    - MAY 2007 -
    An exciting new initiative designed to help stimulate more film and television production in Australia has just been announced. The new Producer Rebate, introduced as part of the 2007 Federal Budget, will take effect from 1 July 2007. The legislation to implement the new measures will be months away some but details have been released.

    The Rebate will provide film producers with a 40% rebate of their qualifying production expenditure and television producers with a 20% rebate. This should help producers put together a viable financing plan for their projects.

    There will be minimum levels of qualifying Australian production expenditure of:

    - A$1m for feature films
    - A$0.5m for documentaries
    - A$1m for long form tv series (13 - 65 episodes, with a minimum spend of A$0.5m per hour)
    - A$1m for mini-series and telemovies (minimum of A$0.8m per hour)
    - A$0.25m for short form animation (15 mins)

    The Rebate will apply to expenditure on eligible projects incurred on or after 1 July 2007 - it is possible that projects in production before that date may qualify for the Rebate on qualifying expenditure from 1 July 2007 but projects will not be eligible if they have received 10B or 10BA investment or Government funding prior to that date.

    It appears that the Government agencies will still be able to provide funding, in "exceptional cases", over and above the Rebate, subject to a cap of 75% of Rebate and Government funding.

    The current accelerated tax write-off provided through Divisions 10B and 10BA will disappear, thereby removing a direct incentive for investors to put equity into film projects. Also, there is speculation that the Rebate will replace the current investment schemes operated by the Film Finance Corporation Australia.

    The new Rebate should stimulate new finance into the industry, either from investors willing to bankroll productions (in return for the right to receive the Rebate) or from lenders willing to lend against the Rebate.

    Blueprint Law is pursuing discussions with potential financiers who should see the new Rebate as an opportunity to participate in this industry.

    At this stage, it is difficult to speculate just how successful these new measures are likely to be until we have seen the full details. But for producers with projects ready to go, they would be best advised to establish whether they can access the new tax credit before starting production.

    We will publish further information about the Rebate as soon as more details become available.