The Federal Government has announced important changes to the Location and Post, Digital and Visual Effects (PDV) Offsets which will provide a much needed boost for the Australian film industry.
The Government will remove the current requirement under the Location Offset for productions valued between $15 million and $50 million to spend a minimum of 70 per cent of their production budgets in Australia. Crucially for the post, digital and visual effects industry the threshold for accessing the PDV Offset has been lowered from $5 million to $500,000.
Ausfilm welcomes this announcement having worked closely with the Government to keep them informed of the state of the industry and the urgent need for action. Both the 70 per cent spend requirement and the $5 million PDV threshold were proving to be unnecessarily restrictive and impeding Australia's ability to compete effectively in the international marketplace. Ausfilm CEO Jackie O’Sullivan said "These adjustments will have an immediate and positive impact for Australia’s film industry and
Ausfilm welcomes the Government’s responsiveness on this issue and its recognition of the economic value of the international productions to the health of the Australian independent screen production sector.
The removal of the 70 per cent spend requirement enhances Australia's ability to provide a more flexible approach to international productions coming to Australia.
For the PDV sector, the new $500,000 threshold will allow companies to pitch for work and generate sustainable workflows, allowing the retention of key staff and investment in infrastructure and organisational growth."
Rising Sun Pictures, responsible for key visual effects on such films as Harry Potter and the Half Blood Prince, X-Men Origins: Wolverine and Terminator Salvation, also welcomed the changes, with CEO Tony Clark saying “The lower threshold announced in tonight’s budget is a big step in the right direction for the Australian film industry.
Whilst the erosion of the value of the 15% Location and PDV Offset by the strength of the Australian dollar is the single biggest challenge facing the international production sector, this lower threshold will bring immediate benefit for Rising Sun and many PDV businesses around the country whilst we await the outcomes of the Government’s formal review.”
These sentiments were echoed by Fuel VFX Executive Producer, Jason Bath, provider of state of the art post production work on projects such as Iron Man 2, The Spirit and Australia.
"The lowering of the qualifying threshold for the PDV incentive is fantastic news for Australian visual effects companies. It has been increasingly hard to get the US studios to bid with Australian companies because our incentive was uncompetitive.
Whilst we still need a higher incentive to be truly competitive, this lower threshold will allow the film studios to work more regularly with Australian companies so that we can build long term relationships based on our talent, giving us every chance to work more consistently on top-level work and retain talented staff from project to project," said Bath.
Ausfilm’s key aim is to attract international film and television production to Australia. Ausfilm is a partnership organisation between private industry and government. It comprises Australia's Federal, State and Territory Governments and 30 private-sector companies. For more information go to www.ausfilm.com
Media Contact:
Anita Nelving
Head of Marketing and Business Development
9383 4191
0449 831313
anita.nelving@ausfilm.com.au