Ontario Seeks To Lure Back Movie Producers With Added Tax Breaks
Ontario is set to increase the tax breaks it offers to movie producers in an effort
to arrest a sharp decline in the number of productions taking place in the Canadian
province.
Although it is one of the largest film production centres in Canada, the industry
in Ontario has been squeezed by a number of factors in the last three years. Chief among these is a strengthening Canadian dollar in relation to the United States, while increased competition in the form of tax breaks for production
firms both from international sources and other Canadian provinces has also contributed
to Ontario’s decline in popularity. Moreover, the American Jobs Creation Act passed by Congress in October has provided
an added incentive for movie makers to stay at home, by allowing independent
studios to write off the costs of a movie in one year, provided three quarters
or more of the budget is spent in the US. However, on Tuesday, Ontario's culture minister, Madeleine Meilleur unveiled
a series of new measures intended to lure back movie makers, which include an
increase in the tax credit for foreign productions to 18% from 11%, and for
domestic productions from 11% to 18%. According to reports, since hitting a peak of C$567 million (US$456.3 million)
in 2001, spending by US production firms in Toronto had fallen to C$333 million
by 2003. A comprehensive report in our Intelligence Report series
describing tax-effective regimes for film production in a number of key countries
is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp
and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report5.asp .
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