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Ukraine passes tax rebate law

KIEV MEDIA WEEK: Champagne corks are popping here in Ukraine after the government passed a law giving the TV and film industries a major tax rebate.

Victoria Yarmoshchuk

Victoria Yarmoshchuk

The long-awaited law comes after 12 months of lobbying from the TV and film industries for government support, following the crisis with Russia, the rapid devaluation of the Ukrainian currency and the prohibition of certain Russian TV programming.

Under the new law, passed by the Ukraine parliament yesterday, producers of feature films can apply for 80% state funding of its production budget. This is an increase on the previous maximum of 50%.

However, the part of the new law that is getting the TV sector excited is that producers of television series can also now qualify for state funding. Producers of TV series are now entitled to up to 50% coverage of their production expenditure as a grant from the state.

Furthermore, film and TV producers from outside Ukraine can now get a cash rebate of 25% of production costs incurred in the country. Up to 10% of those in-country costs can be cast and crew members who are not residents of Ukraine and do not pay personal income tax there.

In addition, public funds will be allocated not only directly for production but also for development and pre-production as well as post-production, distribution and festival promotion.

Victoria Yarmoshchuk, executive director of the Ukrainian Motion Picture Association and CEO of Kiev Media Week, described the move as “a huge step forward, because now Ukraine has become competitive on the global coproduction market.”

She added: “Now we can offer producers from around the world not only our unique filming locations and professional services, but also an adequate system of returning production costs.”

The news has ignited the Ukrainian film and TV community as they gather for the final day of Kiev Media Week, where a major topic of discussion has been how the government needs to support the local audiovisual industries.

Under the new law, mechanisms will be put in place to avoid previous situations where public funds were allocated to pop-up companies that never completed the projects and disappeared without trace.

Therefore, according to the new law, production companies will undergo annual competitive selection. In addition, each one applying to receive state aid will have to pass financial and production criteria and a cultural test for each project.




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