Ukraine Plans to Introduce Film Tax Incentive

Co-productions will be eligible for government funding.

Ukraine is preparing to introduce a tax incentive scheme to open access to state funding to co-productions in a bid to attract foreign cash to the country's film sector.

"We want to attract foreign projects to shoot with Ukraine or in Ukraine," said Filipp Ilyenko, head of Ukraine's state cinema agency. "Those who want to shoot in Ukraine will be soon able to take advantage of a tax incentive scheme, and those interested in co-production with Ukrainian producers will be able to apply for government funding."

According to Ilyenko, the tax incentive system is to be similar to that which is currently in place in the Czech Republic, stipulating a tax rebate on Ukrainian spending, with applying projects required to pass a cultural test.

He added that although Ukraine will normally seek to be a majority co-production partner, state funding will also be open to projects with minority Ukrainian participation.

Ilyenko was unable to give a date for the introduction of the tax incentive scheme, but said that it shouldn't take long. "We want to move quickly," he said. "The more time is spent on discussions, the fewer Ukrainian films will be made."

The introduction of a tax incentive scheme is set to put Ukraine on the map of countries offering production services to Hollywood and other foreign crews in Eastern Europe, such as Croatia and Romania.

Even though Ukraine lost some picturesque locations and a film studio last year, when the Crimean peninsula was annexed by Russia, it still possesses Black Sea locations and studio facilities in the Odessa region. Meanwhile, lower production costs than elsewhere in Central and Eastern Europe could become an extra competitive advantage.