ASTRA leading charge against TV production costs

James McGrath
By James McGrath | 29 June 2015

Subscription TV peak body ASTRA has been lobbying for a doubling of tax offsets producers receive for producing content in Australia, less than two weeks after Foxtel announced it was doubling its investment in local productions.

It told its members late last week that it had received “encouraging” feedback from both government and opposition MPs and senators it had canvassed on the issue.

As it stands, TV producers are able to apply for a 20% offset against the cost of producing content in Australia. The film offset currently stands at 40%, and ASTRA is thought to be leading the charge on asking for the TV scheme to be brought to 40%.

It is believed the peak body is currently trying to put together an economic case it can present to government.

In the initial phase, it is thought ASTRA will lean on research into the effect of a generous tax offset program in the US state of Georgia.

In 2005 it signed into law, and updated in 2008, a 20% tax credit for film productions which outweighed other states in the country.

In 2010, more than $617 million was spent in Georgia from film and TV productions with the offset reaching $140.6 million, with the total taxes collected by the state reaching $148.9 million according to 2011 research from the Motion Pictures Association of America.

While taxes collected only slightly outweighed the total offset, the TV and film industry has also contributed economic multipliers such as local employment.

Roughly two weeks ago Foxtel announced it would triple the amount of money it would spend on local productions, doubling the amount of local drama and comedy which appeared on the platform.

It also comes at a time when local subscription video on demand platforms are trying to figure out how to boost their original offerings without breaking the bank.

According to Roy Morgan research presented at the recent AdNews Media Summit, producing content such as The Voice and X-Factor costs $600,000 to $750,000 an hour.

“It's a big issue for us [production costs] because we are working with clients through advertising,” IPG Mediabrands global chairman Henry Tajer said at the time.

“Media agencies also have to pass on the costs and there comes a point with that cost line becomes really difficult for sponsors and advertisers to come on board.”

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