Late last month, while Hungary was embroiled in do-or-die negotiations with the IMF, most of the talk from boardrooms to cafes concerned Bruce Willis, who arrived in the country for the latest “Die Hard” sequel.
Fox’s decision to shoot parts of “A Good Day to Die Hard” in Budapest underscores Hungary’s growing reputation as one of Europe’s most attractive backlots.
Though several modern and well-equipped movie facilities — Korda Studios, Raleigh Studios and the Stern Film Studio — sweeten the prospect of shooting in Hungary, the real draw to foreign productions is an aggressive tax-credit scheme. According to the incentive, productions can receive a 20% rebate on their Hungarian budget by using a local corporate partner to apply for government tax credits. These credits are then channeled back to the production.
Since its implementation in 2003, this tax system has helped resurrect Budapest’s then-moribund film service industry, allowing the biz to compete head-to-head with neighbors such as Prague, which was famous for wooing Hollywood productions throughout the 1990s.
Not only have these tax breaks lured a spate of high-profile international productions — including the series “The Borgias,” miniseries “The Pillars of the Earth” and features such as “Hellboy 2” and “Tinker Tailor Soldier Spy” — but they have also created a local industry, ranging from production service companies to financial companies, which guide producers through the tax system.
According to industry pros, the tax breaks are not the only reason foreign producers are coming to Hungary, however.
“The tax incentive on Hungarian spend is one of the driving forces of the local industry,” acknowledges Andras Somkuti, deputy CEO of Korda Studios, “but it only puts our foot in the door. We have to deliver great service on many other levels so that foreign productions and producers keep coming back.”
According to Somkuti, an example of the importance of return business can be seen in Showtime’s commitment to make its third season of “The Borgias” at Korda.
“I think Hungary has an edge that will accelerate business into the country,” Somkuti predicts.
Vajna’s goal is to win over locals | Aggressive tax rebate keeps foreign pics coming | Hungarian uprising