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Oz incentive clause

Davey urges gov't to clarify tax break rules

SYDNEY — A-list producer Bruce Davey has intensified the pressure on the Australian government to clarify tax rules for offshore production after Oz investors in “Moulin Rouge” were denied a tax break.

Oz-born Davey suggested adopting the Canadian model of tax incentives: “The government would be foolish not to do something similar, especially as the Australian dollar is low,” he said. “Filmmakers are always chasing the bottom line.”

The L.A.-based producer, who is Mel Gibson’s partner in Icon Prods., told Daily Variety on Monday that if offshore-originated production continued to flourish Down Under, “local production will thrive: They go hand-in-hand.”

Davey joins a growing throng of interested groups, including the New South Wales government, Fox Studios Australia and facilities houses, who have called on the federal government to ensure the division 10B tax laws on offshore production are applied consistently and fairly.

The recent Australian Tax Office ruling denying a tax deduction for “Moulin Rouge,” following a similar decision against local investors in “Red Planet,” has raised fears that international productions will bypass Australia.

The government is reviewing the operation of the 10B provision — which gives a 100% tax writeoff over two years but enables investors to leverage their investment four- or fivefold — and has promised an outcome “within weeks.”

Davey’s plans

Davey would consider using 10B funding if Icon’s pilot “Invincible,” which was shot in Oz and airs on TBS in November, is spun off into a series.

“Creatively, I would like to see the series happen here, (but) others have suggested it should be done in Canada,” Davey said in Sydney before flying to Queensland for this week’s Australian Intl. Movie Convention. There he is due Wednesday to confirm that the Gibson/Madeleine Stowe/Sam Elliott starrer “We Were Soldiers” will be the maiden release from Icon’s fledgling Oz distrib banner.

Davey intends to show exhibs about four minutes of footage from the Randall Wallace-directed Vietnam war epic and to announce two other Icon Film Distribution releases including “Company Man,” a spy thriller toplining Lucy Liu and Jeremy Northam.

Icon Film Distribution CEO Mark Gooder said he will wait until he’s acquired more titles before negotiating Oz homevideo and pay TV deals.

While Gooder indicated eight to 12 films per year would be an optimum number to handle, he agreed with his boss Davey that it’s “not about quantity but about finding the right titles and hopefully doing them right.”

Icon acquired U.S. and international rights (excluding Australia) to Oz comedy “The Man Who Sued God,” which stars Judy Davis and Billy Connolly.

Davey said Icon has held off on pre-selling the pic, preferring to wait until it’s finished, adding it will probably be launched at the pre-Mifed London Screenings.

A number of U.S. distribs expressed interest but none has been given a sneak preview. “Everyone can see it at the same time,” Davey said.

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