A small delegation from Cinecittà Studios toured Los Angeles this week to promote the revised Italian tax credit to Hollywood studios and production companies.
CEO Giuseppe Basso and Cristina Giubbetti, sales manager international productions, were touting key changes that among other things allow Cinecittà Studios to act as an Italian production service company.
The change means the 78-year-old Rome institution has shifted its position to not only provide a range of studio amenities and advisory services but can now pay and process local expenses and guarantee rapid reimbursement.
Revisions to the national 25% tax credit also set up a Euro 10m cap per production company – no longer per project.
“We asked the government in the past few years to allow us to be competitive with the UK system and other countries,” Basso told Screen. “Today we can say we have something very similar.”
“This new incentive allows [foreign productions] to shoot their entire movies in Italy,” said Giubbetti.
Currently Ben-Hur and Zoolander 2 are booked into Cinecittà Studios, with the former scheduled to shoot through June and the latter set to run from Easter to July.
Ben-Hur is making use of the giant sound stages and also shoots in Matera, near Rome, for Jerusalem. The Cinecittà theme park Cinecittà World hosts the chariot race sequences.
Basso, Giubbetti and their associates hope to coax four major US productions to the facilities in Rome each year. Recent shoots on which Cinecittà Studios served as the Italian production service company include To Rome With Love, Third Person and Christ The Lord: Out of Egypt.
Cinecittà Studios fufils its new role on Ben-Hur but will not act as the Italian production service company on Zoolander 2, where Paramount has partnered with a local ‘box’ company.
“This is what Cinecittà has been built for,” said Basso. “This is the reason why Cinecittà was built in 1937: to release big productions.
“In the 1930s Italian producers were feeling competition from the American films and 80% of films in Italy were from America. We wanted to make movies similar to American films in terms of scope and costumes. We needed to become more ambitious.”
The revised Italian tax credit means that from 2011 all invoices made out to foreign film companies are VAT-free.
Qualifying productions must pass a cultural test and score at least 50 points and meet additional conditions. The use of Cinecittà facilities earns supplementary points.
The credit will be based on the production expenses incurred in Italy, which must not exceed 60% of the overall film production budget.
Expenses incurred in another EU country can be treated as expenses incurred in Italy up to a maximum of 30% of the overall film production budget, on condition that these EU expenses are paid by the Italian production service company.
The Italian tax credit is immediately effective as a deduction on monthly taxes to be paid locally by the executive producer (such as corporate and regional income taxes, payroll overheads, social contributions, etc). It is anticipated that productions can start saving cash flow beginning in the fifth week.
The national tax credit can be combined with the Regional Film Fund, which operates along similar guidelines.
“The law is very easy to administrate because the idea was to make things easier for Americans,” said Basso. “We take all the responsibilities and they shoot the movie.”