Proposed reductions threaten production

The red carpet at the recent Rome Film Festival was a bit thin on stars, but it was packed on opening night with some 1,200 incensed members of Italy’s film community protesting against impending government cuts that could spell doom for the local industry.

This turmoil comes just as Cinema Italiano is truly gaining traction, both at home and in the international arena where sales of Italo titles are surging, as attested to by deals at Rome’s Business Street mart and during AFM.

Italy’s formerly insular industryites are also becoming among the world’s most active co-producers. And thanks to the now-frozen tax credits for foreign productions, the country had just started luring high-profile U.S. pics, such as “The Tourist” and “The American,” for extended Italo shoots.

“Huge damage has already been done,” cried the prexyof Italy’s producers org,Riccardo Tozzi, about the threatened tax incentive cuts at a confab during the opening of the Rome fest in late October.

Tozzi, who heads Cattleya, which is Universal’s Italian outpost, says he has five projects lined up to shoot next year but will be forced to greenlight only two if the incentives get the government ax.

“I have been talking to two American producers who want to shoot in Italy and we are waiting to see what will happen,” complained “The Tourist” line producer David Nichols to the packed room where pent-up anger was palpable.

Just last year, the Silvio Berlusconi government introduced eagerly awaited tax breaks, both for local and international productions, as part of a planned phaseout of Italy’s sometimes parasitic film subsidies. But, blaming economic constraints, the government last month included these incentives on the list of possible cutbacks, raising doubts that they will be renewed in the upcoming budget.

Tozzi and many others claim that cutting the tax incentives makes no economic sense since it will kill movie jobs, diminish the fiscal flow into state coffers and prompt a process of possible “self-extinction” just when the national industry is finally starting to move beyond bare survival.

Italian movies will account for at least 30% of the local market share this year, the second-highest homegrown slice in Europe after France.

And recent hits, including Luca Miniero’s “Benvenuti al sud,” a local remake of Gallic megahit “Welcome to the Sticks”; Paolo Virzi’s pic about a protofeminist mom, “The First Beautiful Thing,” which is Italy’s foreign-lingo Oscar candidate; and comic Carlo Verdone’s “Io Loro e Lara,” about a priest having an existential crisis; all point to the fact that Italy has found ways to make commercial pics without stooping to the lowest common denominator.

“Italy is now generating a steady output of domestic slice-of-life type stories that are often multigenerational and accessible to broader audiences without falling into the trap of being in a made-for-TV mold,” says British distributor Chris Johnson, who earlier this year launched Vita, a niche U.K. distribution company dedicated to Italian cinema.

In a flurry of deals involving Italo movies lately, the standout is probably Wild Bunch taking multi-territory rights, including Spain, Latin America and Japan, to “Beautiful Thing,” which it will release in France.

But the momentum of Italian cinema would certainly stall if proposed cuts pass.

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