Italy's Prime Minister Says He's 'Committed' to Funding Cinema Tax Credit
ROME – Italian Prime Minister Enrico Letta took the first steps toward defusing a difficult situation swirling around the fate of Italy’s cinema tax credit, telling parliament the government is “committed” to locating the resources necessary to keep the credit funded beyond the end of next year.
The government sparked a strong response from Italy’s cinema and television sectors last week when ministers said the tax credit would not be funded after the end of next year, eliminated as part of a wide-ranging round of government belt-tightening. The credit provides up to €5 million ($6.6 million) toward production costs for Italian productions and up to €3.5 million ($4.6 million) for Italian co-productions shot in Italy.
Around three dozen industry groups -- including audiovisual association ANICA, the cinema exhibitor’s association ANEC, the entertainment industry association AGIS, the 100autori writers’ association, plus various regional film boards and several trade unions – protested the government’s decision, and have threatened to “block” the Venice Film Festival’s July 25 conference on its new lineup if the credit is not reinstated by then.
In his remarks during a parliamentary question-and-answer session, Letta stopped short of promising the credit would be funded beyond 2014. But his remarks will be a welcome development to the groups protesting the tax credit cut.
In 2009, cinema sector groups threatened similar action at the Venice press conference when the tax credit was under threat. But after some progress in negotiations, the groups simply read a letter of protest at the conference, and the tax credit was renewed without interruption.
Two months ago, after the appointment of Massimo Bray as minister of culture in the new Letta government, industry players told The Hollywood Reporter that a renewal of the tax credit should be a top priority for the new government.
The Letta government is working hard to reduce debt in order to stave off fears the country could fall victim to the European debt crisis. At the end of last year, Italy’s debt was the equivalent to 127 percent of the country’s gross domestic product, the second highest debt-to-GDP ratio in Europe, behind only Greece.