Tax breaks threaten Czech film industry

Radio Prague is introducing Screen Czech - a monthly show devoted to film and TV production here in the Czech Republic. Over the next few months Peter Smith will be bringing you news about the industry and interviews with the people most closely involved, both Czech and foreigners coming here to work. There will also be a run down of all the latest Czech movie news coming up. The first edition of Screen Czech deals with a controversial issue that threatens to derail foreign investment in the movie and TV industry here in the Czech Republic. Tax.

Tax breaks and state cash back on expenses are some of the key elements when it comes to shooting any film or TV project. However, the present cash incentives scheme on offer to film producers here in the CR has been described in some quarters as inadequate and even endangering the future of the industry. All a far cry from those heady days after the 1989 Velvet Revolution when western filmmakers were queuing up to shoot in the then Czechoslovakia and at Prague’s renowned Barrandov Studios.

I recently spoke to Mathew Stillman, boss of Stillking Films and someone who has been involved in the film industry since those post-Velvet Revolution days. I first asked him what first attracted foreign filmmakers to the country.

“The overall message was that you could create more value here. It’s cost relative to all the other elements that you need to make films or videos or commercials. So it’s things like the crew – their skills, their depth, can they do stunts. Is there a good wardrobe, are there good Ads (assistant directors), sound people, all sorts of different things. Are there good studios, are there physically good places to shoot. A combination of all those factors together. You need a certain infrastructure to make films. Those things together with things like hotels to house people are essential ingredients to make films. If you have all these in one place you can do it anywhere.”

“At the time, there were very skilled crews in the UK and the US. But here there was a will and a desire and an energy. And that combined with the natural advantages and historical advantages that existed in the Czech film industry meant that through the nineties the Czech industry was able to grow into one of the top two or three in the world.”

Mathew StillmanMathew Stillman Filmmaking is now an international market – all the studios worldwide are competing with each other. So incentives are imperative. But the Czech Republic presently has a 20 cash back scheme in place – sounds good? Well not quite – Matthew Stillman again:

“There’s twenty percent back which started about two years ago, but the problem with that is there’s a limited fund. So this year it is $18 million and you get twenty percent back, but once the eighteen million is exhausted then that’s it – it’s not a great amount. So that caps the amount of production that can come in. The second problem is that it has to happen on an annual basis – so the twenty million is only available for 2011. So you have to apply for it, shoot your film, audit your film and claim the rebate within those twelve months, and almost no films happen across a calendar year. So on two levels it doesn’t really work.”

Big productions such as Mission Impossible and the James Bond epic Casino Royale were filmed here – but are future opportunities being squandered?

“Actually they have lagged behind what other states have done. As the Czech Republic became more successful, it reached a situation in 2003/04 when the rest of the world became envious of what the Czech Republic had and at that point other states started offering grants and incentives to attract filmmakers. And still, as we sit here today, we are trying to figure out how to get money from the state for incentives – a proper regulated programme, so the Czech state has fallen a long way behind the speed and the dynamism of the industry internationally.”

'Casino Royale''Casino Royale' And as Matthew Stillman says, projects are at serious risk of being lost. There’s Henry 5th that we’re hoping to do with the BBC. There’s a Brad Pitt film for Paramount. There are several but they are all contingent upon money being available as an incentive. Their other options all have incentive money available and at the moment we don’t have a clear commitment that money will be available from the beginning of this year and the end of next year from the government. Unless that comes, they will go to alternate places.

And what with other countries catching up, the Czech film industry must learn to be competitive again – and it must learn fast. Matthew Stillman of Stillking films:

“Five years ago the Czech Republic did five times more than Hungary. This year Hungary will do five times more than the Czech Republic. Hungary is providing 25 percent rebate on the money that’s spent there, UK's providing 20 percent. So everybody is providing these incentives and the Czech Republic is not adequately – they are providing a programme that doesn’t function, it cannot function, because films are not made in one year and they need to have the security of knowing. The Brat Pitt one wants to start at the beginning of this year and shoot next year – so does Henry 5th the BBC one. They need to have the security of knowing that the incentive is available at the end of this year and next year. Hungary they know it’s there, UK they know it’s there, Australia, US – all the US states have the money now. So, we’re not competitive because we are unable to be competitive it terms of the money that they are offering.”

“And I should say that I contacted the government about the incentive issue, but they declined to comment.”

Quickly to film news:

Several international TV films and series are currently being shot in the Czech Republic.

The shooting of the ten-episode American TV series Missing will take place in Prague and its surroundings until October. The story centres around a mother, played by Ashley Judd, who searches throughout Europe for her missing son. The crew will spend in total more than 90 days shooting in the Czech Republic along with a few days in Croatia and in Istanbul.

The film Die Kastellanin (The Castellan), the story of a young woman Marie (Alexandra Neldel) set at the beginning of the 15th century, is being made for the German SAT1 television station and Austria's ORF with filming taking place at Křivoklát, Točník and Kokořín castles. The production is being arranged by Germany’s TV60 München in coproduction with the Czech Republic’s Wilma Film and Barrandov Studios.

The 48 Hour Film Project comes to Prague on the weekend of October 21st. Filmmakers from all over the Czech Republic will compete to see who can make the best short film in only 48 hours. The winning film will go up against films from around the world.