The New Film Tax Incentives Status Update

Unless ones had their head in the sand the last several months it should be quite obvious that the film tax incentives landscape has changed drastically. The soft film finance money aiding a film budget for independents and studios alike has been steadily evaporating.

Newly elected officials in the legislatures and the Governor's office have taken the reigns to draw in expenditures and balance budgets. The wisdom of doing so in massively scaling back the incentive for inward film production spend dollars remains to be seen, however it is clearly already putting thousands of film production crew out of work across the country.

The direct result is reduced film funding for indie films and an even greater importance for a lean and accurate film budget and schedule to present to investors. Greater attention to detail and utilization of the latest economizing production techniques is certainly needed.

Film Tax Incentives Suffer Massive Reductions

The film tax incentive market supporting the domestic film budget of feature film and television production across the United States continues to undergo a massive assault of new political realities. The new austerity facing local governments combined with long festering modalities and economic theories have lead to the biggest rollback and shear elimination of state incentivized filmmaking in historical terms.

The states enacted film tax credits to counterbalance runaway production film budget expenses to other countries, mostly Canada and Eastern Europe. At a time when the cost of making a movie in the US was steadily increasing, and likewise the film budget of those productions, the film tax credit helped keep production dollars at home and brought that spend to the state and local level.

As these subsidies dry up a major element of film finance is disappearing and the trend will be to offshore film production once again. California understands this, as do several states, including Louisiana and they will be the victors in attracting inward spending of the production film budget dollars of movie and television productions.

Filmbudget.com

Midnight in Paris

'Midnight in Paris'

Director: Woody Allen

Stars: Owen Wilson, Rachel McAdams, Marion Cotillard

Released: May 20, 2011

Film Budget: $30 Million (estimated)

Opening Weekend US Box Office: $599,000

Current Box Office:

USA $15,000,000

International $10,000,000

Current total: $25,000,000


View the trailer:

DVD / Home Video Downturn Forces Layoffs at Studios

The downturn in the dvd and home video entertainment market has been widely reported for some time as it affects every aspect of a film budget and profitability for the distributors. The major Hollywood studios have stated significant reductions in revenues due to the decline.

While new media outlets, including VOD, Netflix, Hulu and Amazon have taken up the demand for home entertainment, the income generated is not nearly close to making up for the loss to the industry's bottom line.

The Walt Disney Studios announced last week it would layoff 200 or 5% of its workforce, mostly in distribution but some in home video as well. Fox Home Entertainment has fared better as a distributor of other production and distribution companies home entertainment in addition to their own, however the have announced today a layoff coming of about 22 employees.

Likewise Lionsgate Films recently announced a round of workforce reductions. All of these actions are claimed to be a result of the decrease in rental and sell through revenue to their coffers.

The continued turmoil in the industry, combined with difficult to find film finance and the current pull back in state sponsored film tax incentives must impact the film budget of every production. Now more than ever before it is critical that a production film budget and schedule be as accurate and proven as possible, and created by a professional line producer with extensive experience and track record.

Read The Wrap article

'The Girl with the Dragon Tattoo' teaser trailer

The hotly anticipated remake of the Swedish classic 'The Girl with the Dragon Tattoo' will be released for Christmas 2011.  Starring Daniel Craig, Stellan Skarsgard, Rooney Mara and Christopher Plummer.

The first episode of the trilogy from writer Steig Larsson the production weighs in with a hefty $100 million film budget which may be attributable in large part to the action, stunts and effects.  Also driving the film budget level is likely the rights to the internationally acclaimed hit trilogy and the star-studded ensemble cast.   The movie is certain to amply recoup its movie budget cost!





Filmbudget.com