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Romania could see a five-fold increase in movie productions if it introduced targeted tax incentives, says PwC.
Romania is one of the few countries in the European Union that does not provide some form of state support for the audiovisual industry. In a new study, PwC argued that the "quite spectacular" results of incentive schemes in other EU countries shows that there is a strong case for similar tax breaks to be introduced in Romania.
"Romania has indisputable strengths in this sector (very talented film-makers, extremely diverse and appealing shooting locations etc., the positive image the Romanian cinema enjoys abroad as a result of the movies awarded in the last years), but without financial and tax instruments to support an attract international movie productions, all this potential remains untapped," said Mihaela Mitroi.
PwC Romania has proposed a system of tax incentives similar to those in place in other Central and Eastern European countries, whereby 25 percent of total eligible costs would be refunded to producers, and 50 percent of the income tax paid in Romania by qualifying non-resident investors would be reimbursed.
PwC's study estimates that the introduction of such a scheme would lead to the creation of 4,000 new jobs and boost the economy of Romania by EUR850m to EUR974m annually as a result of the multiplier effect of increased investment by producers, including increased tourism, and higher spending on the goods and services consumed by the film industry.
The study concluded that tax and other incentives have led to 500 percent growth in the audiovisual sector in Hungary since 2003, and 300 percent growth in the industry in the Czech Republic since 2010.
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