Country hopes to boost domestic cinema, attract int'l prod'n
BUDAPEST — Both the Hungarian film biz and foreign production companies are in line to benefit from a new trust launched by Budapest-based investment bank Concorde Securities.
According to Concorde Securities director Mike Boris, this trust will help foreign productions get off the ground in Hungary.
“Concorde Film Trust definitely applies to foreign productions as well as Hungarian,” says Boris. “It shows that there are more and more advantages for major foreign productions in Hungary.”
The existence of the Film Trust is a further indication of the changing climate in the Hungarian film industry after passage late last year of a dynamic domestic film law some say is one of the most cinema-friendly of any country.
In a bid to boost domestic cinema and attract international productions, lawmakers passed a statute that offers rebates to foreign films and investment incentives designed to encourage corporate sponsorship of the industry.
Under the law, a Hungarian company can receive a 100% deduction on all money invested in a film produced in Hungary for a total amount that does not exceed 20% of the movie’s Hungarian budget.
In short, an investor can write off $200,000 invested in a $1 million movie, and according to Concorde, foreign producers can also tap into this investment opportunity for productions (or those parts of the productions) that are made in Hungary.
Foreign producers aiming to use tax incentives to drum up investment must register the productions with the Hungarian Film Office, which enforces the film law. It will verify if the production meets the litmus test for corporate tax breaks.
According to Boris, the trust was designed to support not only Hungarian cinema but all films made in the country.
Hungary lost its advantage as a destination for foreign films in the early ’90s to enterprising neighbors like the Czech Republic. But this is changing. “I think this law and the trust will once again make Hungary a beneficial area to make a movie,” says Boris.