BRUSSELS — A 30% tax credit for Italian movie theaters installing digital projection equipment is to be investigated by European regulators.
The European Commission said Thursday it was concerned that the proposed tax credit will benefit large multiplexes rather than more needy smaller theaters.
“More than 75% of Italian cinemas have one to four screens and, due to their lower profitability, they seem less likely to benefit from the proposed tax credit than larger multiplexes,” EC competition commissioner Neelie Kroes said.
The investigation is a chance for all interested parties to comment on the Italian scheme.
“A public debate on the impact of digital cinema in Europe is long overdue since some have suggested that thousands of Europe’s arthouse and local cinemas may face closure because they cannot afford the conversion costs,” Kroes said.
Question is likely to headline a workshop on digital cinema planned by Italian authorities during the Rome Film Festival in October.
Meanwhile, the commission has rubber-stamped Italy’s €82 million ($117 million) package of tax incentives to stimulate investment in European films.