With the state of the global economy still in flux, film and television financing, an already complex area, is more difficult than ever for entertainment executives to navigate. State and country governments, many of which are still recovering from the global economic crisis, are limiting tax incentives and credit programs that have often been used to attract production to a jurisdiction. To help those in the entertainment industry better understand and manage these challenges, KPMG released today its sixth edition of “Film Financing and Television Programming: A Taxation Guide,” which focuses on the trends, barriers and rules that will be the greatest drivers within the international film and television production community. The guide covers more than 35 countries, including Romania.
“Recent trends in tax laws and significant shifts in incentive and credit programs – critical factors in determining the success of a film or television project – have made it a much more challenging environment for decision makers in the industry who are seeking the most viable locations for production,” said Anthony Castellanos, Global Accounts Lead Partner and Industry Leader at KPMG. “Many are turning to untraditional areas – like emerging markets – to find attractive new opportunities.”
He adds, “Although there can be benefits to moving locations internationally, there are also many tax implications associated with doing business in another country. It’s critical that entertainment executives – in addition to thinking about how they’re actually going to obtain financing for a project – also consider the potential tax consequences based on where they decide to produce or film.”
As Mark Gibbins, Partner and Head of Taxation Services at KPMG in Romania comments: “In recent years, many producers have come to see the attractions of Romania as a filming location, and several feature films have been made here. The country has spectacular scenery, unspoilt historic towns and a well developed film industry, led by talented people. This new KPMG publication will provide a resource for any production company which is interested in making a film in this country. The guide gives information about Romanian taxes, including corporate and individual income tax, VAT, dividends, interest and royalties. It also explains the legal framework for a film company to register in Romania, and obtain the necessary authorisations, both for producing the film and for distribution in Romania.
Information on co-productions is included, as well as details of financing possibilities under Romanian and EU law.”
KPMG’s Film and Television Tax Guide highlights 35 key countries with a stake in the film and television production industry, providing a description of commonly used financing structures as well as the commercial and tax implications for conducting business within each location.
The countries referenced in the guide include: Australia, Austria, Belgium, Brazil, Canada, China and Hong Kong SAR, Colombia, Czech Republic, Fiji, France, Germany, Greece, Hungary, Iceland, India, Indonesia, Ireland, Italy, Japan, Luxembourg, Malaysia, Mexico, The Netherlands, New Zealand, Norway, Philippines, Poland, Romania, Singapore, South Africa, South Korea, Sweden, Thailand, United Kingdom and United States.
For more information about KPMG’s Film and Television Tax Guide or to download the full sixth edition, please visit: www.kpmg.com/filmtax.