BRUSSELS — Europe’s film industry should get a much-needed cash injection following changes to the Belgian Tax Shelter Law.
The law was passed in 2002 to encourage investors to finance audiovisual projects in Europe, but it proved unworkable from the outset.
The law stated Belgian companies investing in Belgian audiovisual productions could deduct 150% of the investment off taxable profits.
But companies even loosely linked to broadcasting were barred from the tax perk, and other companies had to invest in a project upfront to get a tax benefit. In addition, profits from the scheme had to be kept in reserve and were not available for distribution among shareholders.
SCOPE Invest, for instance, a film finance company founded by Genevieve Lemal and Alexander Lippens to take advantage of the law, has so far backed only one film, “Lucky Jam,” directed by Lieven Debrauwer.
However, modifications to the law worked out last week by Belgian politicians should encourage more money men to come forward.
The definition of companies barred has been narrowed to exclude only those explicitly involved in broadcasting. In addition, the length of time investors are allowed to submit a tax document certifying the amount of production money spent in Belgium has been extended from two to five years.