The European Commission has approved Italy’s eagerly awaited film production incentives, paving the way for tax breaks amounting to up to 25% of a film’s budget to go into effect in early 2009. The incentives will apply not only to local but also to U.S. and other foreign shoots.
Long sought by Italian producers as a crucial lifeline, the tax breaks, which are capped at $7 million per project, are expected to pump as much as $350 million annually into the local industry.
The breaks are expected to place Italy on a par with near neighbors Germany and France, where tax credits are drivers of vibrant indie industries and total film production spend is, respectively, triple and double Italy’s current $500 million or so per year.
Italian Film Board topper Gaetano Blandini applauded the European Commission’s greenlight for the incentives, which “had been longed for in Italy for at least 15 years,” he said.
Blandini and his team are now expected to complete swiftly the final paperwork to enable producers to tap into the tax breaks by early next year.
“The Italian film industry will undoubtedly benefit from these measures, which are crucial to consolidate the sector, to boost a new-found interest in our cinema, and reach new European and world markets,” said Italian motion picture association Anica prexy Paolo Ferrari, who is also topper of Warner Bros. Italia.
Earlier this year, Italian producers had threatened a boycott of the Venice, Rome and Turin film festivals in protest against a decision by the Silvio Berlusconi government to scrap the long-in-the-works film incentives bill. That move proved effective, prompting parliament to backpedal and instead send the bill to Brussels for EC approval.