Australia: Consultation on proposed changes to “producer and location tax offset”

Treasury released for consultation exposure draft legislation on changes to “producer and location tax offset”

Consultation on proposed changes to “producer and location tax offset”

Treasury released for consultation exposure draft legislation [PDF 245 KB] that introduces changes to the “producer tax offset” and the “location tax offset.”

According to Treasury, the changes are part of the federal government’s commitment in the 2023-2024 budget and 2023-2024 mid-year economic and fiscal outlook to support the Australian screen industry.

The draft producer tax offset law [PDF 136 KB] seeks to amend the Income Tax Assessment Act 1997 (ITAA 1997) to allow a film production company to qualify for the producer tax offset by spending a minimum of $35 million* of qualifying Australian production expenditure for a season of a drama series, over a maximum period of 12 months of production or 36 months for an animated image film series.

The draft location tax offset law [PDF 199 KB] seeks to amend the ITAA 1997 to:

  • Increase the rate of the location tax offset to 30%
  • Increase the minimum qualifying Australian production expenditure required to $20 million and the per hours threshold to $1.5 million
  • Include a minimum training expenditure test or alternatively a requirement to establish or upgrade certain permanent Australian film infrastructure or satisfy certain training program requirement for individuals working on the film
  • Require some post, digital and visual effects for productions to be provided by Australian providers or through an Australian permanent establishment
  • Enable the Arts Minister to request information by written notice in a specified period for the location tax offset

The consultation closes on 16 February 2024.

*$=Australian dollar

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