Russia to Launch Film, TV Production Incentives in Three Regions in 2017

MOSCOW, RUSSIA -A general view of Red square and Kremlin-Getty-H 2016
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With the budget for the tax rebates limited to just under $1 million, homegrown and independent productions are more likely to tap into the plan than Hollywood blockbusters, but it could pave the way to a bigger national system.

Russia will introduce tax rebate programs for local and foreign film and television productions in three regions as of 2017.

The Kaliningrad exclave in the country's Northwest, Primorsky Krai in the Far East and the Astrakhan region in South Russia will be the first regions to offer tax rebates to film crews coming to shoot there.

The government hopes the introduction of the plans also will help to attract travelers to regions that are situated outside the traditional tourist areas.

Russian culture minister Vladimir Medinsky was quoted by news agency TASS as saying that the success of attracting The Lord of the Rings to New Zealand was among the inspirations for the move.

Although the amount earmarked to be spent on rebates in 2017 is small at 60 million rubles, or just under $1 million, film production costs outside Moscow and St. Petersburg are very low, so homegrown shoots and independent productions from the U.S. and Europe are seen benefiting from the program. Big Hollywood blockbusters are not expected to see it as a major draw.

To qualify for rebates, productions will have to spend a certain portion of their budget in the region, but the exact percentage and other criteria must be worked out by the end of the year.

However, the regional initiatives could pave the way for a national rebate system, which has been discussed for years.