Written by David Lewis on Feb 4, 2008. Posted in Incentive News

South Africa announces new incentive programme

The Department of Trade and Industry (the dti) just announced new incentive programmes for the film industry, which will be effective from the 1st February 2008.

The new film and television production incentive comprises of the Location Film and Television Production Incentive, and the South African Film and Television Production and Co-Production Incentive. The incentive is intended to increase local content generation and improve location competitiveness for filming in South Africa.

The Location Film and Television Production Incentive will replace the Large Budget Film and Television Production Rebate, which the dti implemented in 2004.

This component is only available to foreign-owned productions with Qualifying South African Production Expenditure (QSAPE) of R12 million and above. It provides a rebate of 15 per cent of the QSAPE to qualifying productions in the following formats: feature films, telemovies, television drama series, documentaries, animation and short form animations. Its aim is to attract large-budget overseas film and television productions to South Africa.

The value of the rebate for any qualifying production is capped at a maximum of R10 million.

The South African Film and Television Production Incentive is being introduced in order to provide more financial support for locally-owned productions and co-productions.

This component is available to both South African productions and official treaty co-productions with a total production budget of R2,5 million and above. It provides a rebate of 35 per cent for the first R6 million, and 25% for the remainder of the qualifying production expenditure. The following formats are eligible: feature films, telemovies, television drama series, documentaries, animation and short form animations.

The value of the rebate for any qualifying production is capped at a
maximum of R10 million.

Effectively, the following key changes are being introduced:
*The reduction of the threshold from R25 million QSAPE for foreign-owned productions to R12 million;
*A differential requirement that local-owned productions and co-productions must have at least R2,5 million of total production
budget;
*An increase of the rebate from 25% up to 35% for local productions in order to ensure higher financial support for local
productions;
*The reduction of the threshold will make the bundling of productions unnecessary for producers
*The provisions of the incentive will encourage production companies to advance industry transformation through adherence to the requirements of Broad-Based Black Economic Empowerment.

All productions approved in terms of the Large Budget Film and Television Production Rebate would still be treated under the rules of
that scheme, and will not be able to convert to the new incentive.

Please find a media statement, guidelines and application on the dti, website www.thedti.gov.za