German Government Promises Tax Incentives, Investment Boost for Struggling Film Industry
The new German government has promised to back the local film and TV industry, pledging to boost production tax incentives and implement investment requirements for global streamers operating in the country.
The incoming government, headed by presumptive future German Chancellor Friedrich Merz, outlined its plans on Wednesday making the film industry’s wish list part of the coalition agreement between Merz’s conservative CDU party and partners the CSU and SPD. The coalition deal will include proposals by the German industry to boost the country’s production tax incentives and introduce a French-style “investment commitment” from global streamers.
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Proposals put forward and supported by professional groups, including ‘s Film Academy, the production alliance, which represents film and television producers, the directors’ association, the German screenwriters’ association, and the Guild of German Art Cinemas, would see a minimum 30 percent tax incentive for local shoots and an investment requirement from streamers of up to 25 percent of their German revenue. The streaming giants have opposed legislation requiring mandatory investment in local productions.
Germany’s film and TV industry is in desperate need of a boost. A recent survey by the production alliance found that 80 percent of their members were struggling financially. Theater admissions fell 5.8 percent to 90.1 million in Germany last year, a much sharper drop than in most Western European countries, and domestic titles took just 20.6 percent of the market, a 3.7 percent drop. Television revenue is also down.
Producers got a lifeline late last year when the outgoing government approved a new version of the country’s film funding law, keeping in place state subsidies for local productions, without which German film production would grind to a halt. But in concessions to Merz’s Conservatives, the version of the law excised a clause that would have required all German film productions to meet specific diversity, gender equality, inclusion and anti-discrimination standards.
“The coalition agreement is good news for the industry – the messages are encouraging,” said Björn Böhning, managing director and spokesperson for the production alliance. “Producers have repeatedly advocated for the joint introduction of the two key film policy instruments [tax incentives and investment requirements]. The fact that the coalition partners now want to implement these promptly is encouraging…France, for example, has proven that the joint introduction of an investment commitment with an incentive system is an recipe for success: It attracts investments, stops profits from being skimmed off, and strengthens the domestic infrastructure of studios, service providers, and a diverse production landscape.”
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