Slovenia Mulls Tax Rebate to Lure International Productions

The new scheme would be similar to others in Eastern Europe and include changes to funding for local films, with obligatory contributions from TV, distributors, exhibitors and telecom companies.

MOSCOW -- Slovenia is set to become the latest Eastern European country to introduce incentives to lure international productions.

The European Union member state -- which seven years ago became the first former Communist state to adopt the Euro as its currency -- is considering tax rebates worth up to 20 percent of local spend between Euro 200,000 and Euro 2 million ($275,000 to $2.75 million).

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A new cinema law, currently being out for public consultation, offers a package similar to others introduced across the region in the past decade from the first, Hungary to the latest, Lithuania.

Like those laws, Slovenia's will be subject to EU regulatory approval.

Slovenia, which after some early clashes in the Balkans civil war of the 1990s forged its own, peaceful path, has the best developed economy among the republics of former Yugoslavia.

If adopted, the new scheme will offer tax incentives for feature, documentary, animation and television projects partially or fully produced in the country. Croatia and Serbia, also former Yugolsav states, both already have similar schemes.

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Projects will need to pass an official 'cultural test' proving there is good reason for them to shoot in Slovenia.

Public consultation on the draft cinema law continues through late March. It also includes measures to replace the Slovenian Film Center with a new funding agency, the Slovenian Audio Visual Center or SLAVC.

The new agency would provide up to a half of the budget for Slovenian productions and up to 80 percent for children's films and low-budget productions. The money would be drawn from the state budget and -- controversially -- from mandatory contributions from broadcasters, distributors, exhibitors and telecom operators.

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Jozko Rutar, head of the Slovenian Film Center, said he welcomed the changes, which backers hoped would be made law by the summer with implementation from January 2015.

But he expected major resistance from those expected to contribute to the new fund for domestic movies.

"We can expect a big fight -- lobbying -- against the proposed law, especially from private television and operators. Until now they were not obliged to pay anything toward the production of national films," Rutar told The Hollywood Reporter.

So please be aware that we can expect big fight (lobbying) against the proposed law, especially from private TVs and different operators. Till now they were not obliged to pay anything towards production of national films.