The Government has begun a consultation on the future of the Section 481 film and TV tax incentive scheme with the aim of delivering an impact assessment of any potential changes after it ends in 2015.
Minister of Finance Michael Noonan yesterday published a consultation paper entitled ‘Review of Section 481 Film Relief’ and is inviting submissions as part of the public review until Tuesday, July 31.
A summary of the consultation questions in the document include “Is the current scheme maximising the potential economic benefits to Ireland in terms of stimulating activity in the film and TV sector? If not, why not?” and “What are the economic arguments for restricting or terminating the scheme?”
The document includes preliminary analysis on data provided by the revenue commissioner on the scheme over 2005 to 2011, with the review set to be carried out with reference to a number of reports recommending that the scheme be reviewed and renewed or extended beyond 2015.
These reports include The Creative Capital Report (2011); The Indecon Report (2007); the Audiovisual Federation Review (2011) and the Commission of Taxation Report (2009).
The move has been met with some caution by Screen Producers Ireland who intend to make a “substantive submission” in reply to the consultation. SPI has called for contributions from its members by June 29.
Speaking to IFTN, Barbara Galavan, CEO of Screen Producers Ireland, said: “While the review of Section 481 is necessary, it is also somewhat worrying from the industry’s perspective for fear that the Department of Finance would do something drastic like strike a pen through the relief. I don’t believe that is their intention but if they were to do that, it would have a very significant negative effect on the industry here.
“The audiovisual production industry, when last valued in 2008, was estimated to be worth in excess of €550m to the Irish economy. It employs in excess of 5,500 people and has been identified as a sector with significant growth potential. Any threat to existing jobs in the sector or to the potential for growth in numbers employed, needs to be taken very seriously.
Galavan added that Irish producers compete globally to bring film and television projects to Ireland “many of whom come to the market place with similar and sometimes more competitive local tax incentives.”
She added: “I understand the Department of Finance will be looking to those tax incentives abroad and I hope they will consider these in the context of improvements that might be made to the Irish scheme.”
Section 481, known as the “film relief scheme,” is one of the longest running sector specific tax reliefs and has been in place under various formats since 1984.
The scheme is intended to contribute to the development and sustainability of the Irish film industry which supports a significant number of jobs.
The Department of Finance added of the review that the “impact assessment will enable the Department to better understand the benefits that may accrue to the exchequer in terms of additional tax yield as well as consequences for investors, the audiovisual industry, and the wider economy arising from potential changes to the relief.”
Submissions can be made by email to: Filmtaxconsult2012@finance.gov.ie or by post to Film Tax Relief Consultation, Department of Finance, Government Buildings, Upper Merrion Street, Dublin 2.
The ‘Review of Section 481 Film Relief’ consultation document can be downloaded here.