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Tax Reliefs

Dáil Éireann Debate, Thursday - 26 November 2020

Thursday, 26 November 2020

Questions (116, 148)

Richard Boyd Barrett

Question:

116. Deputy Richard Boyd Barrett asked the Minister for Finance his views on whether a film production company in receipt of section 481 tax relief claiming in the Labour Court or Workplace Relations Commission that it is not the employer of the film crew working on a film production funded by section 481 relief represents a breach of the declaration that company is required to sign in order to access the relief and that any company doing this should have the relief withdrawn; and if he will make a statement on the matter. [39233/20]

View answer

Richard Boyd Barrett

Question:

148. Deputy Richard Boyd Barrett asked the Minister for Finance the actions being taken to ensure that film production companies in receipt of section 481 tax relief are complying with the declaration on quality employment and training they are required to sign in order to access the relief; and if he will make a statement on the matter. [39232/20]

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Written answers

I propose to take Questions Nos. 116 and 148 together.

Section 481 TCA 1997 provides a 32% payable credit for eligible expenditure on film production in Ireland. The scheme is intended to act as a stimulus to the creation of an indigenous film industry in the State, creating quality employment opportunities and supporting the expression of the Irish culture.

The Deputy will be aware that a number of amendments were made to the Section 481 tax credit as part of Finance Act 2018. The certification process was amended, production companies are now required to apply to apply to the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media (DTCAGSM) before commencement of Irish production to have the film certified as a qualifying film.

As part of the application process, applicants must provide a skills development plan and, if the amount of eligible expenditure is over €2m, that plan must be agreed with Screen Ireland. A post project skills development report is also required for each project.

As part of the certification process undertaken by DTCAGSM, an applicant company is required to sign an undertaking of compliance with all relevant employment legislation. This undertaking is required to be signed and furnished with every section 481 application. These conditions shall be met by both the producer company and the qualifying company. If a producer does not comply with the employment and skills development requirements set out by the Minister they may not be eligible for the corporation tax credit. Any amount already claimed may be recoverable, with interest.

Adjudication of adherence to employment legislation is not within the remit of the Minister for Finance, however the importance of adhering to employment legislation has been reinforced by introducing the undertaking in respect of quality employment. The monitoring of compliance with employment rights legislation is primarily a matter for the Department of Enterprise, Trade and Employment through the Workplace Relations Committee (WRC). Should the WRC determine that a company in receipt of section 481 tax relief has not complied with the relevant employment rights legislation, as stated, any amounts claimed may be recoverable with interest.

The Deputy will be aware that the WRC completed an audit of the Independent Film and Television Drama Production Sector this year, following a joint request by the Irish Congress of Trade Unions (ICTU), the Services, Industry, Professional and Technical Union (SIPTU), and Screen Producers Ireland. The report, which was published in August, contains four recommendations, none of which are recommendations for changes to be made to Section 481. However the audit does recommend that a formal agreement between the majority of workers and employers, addressing pay, terms and conditions, would be beneficial for the industry. I understand that negotiations in this regard are currently ongoing between Screen Producers Ireland and the unions (of which the Guilds are also a part) and I am informed that the agreement should be finalised later this year.

As stated above, the creation of quality employment opportunities is a policy objective of the film credit and I have made a number of changes to the legislation in recent years to support this objective. My officials are following the progress in respect of the WRC recommendations and I will take further actions to support the key objectives of the credit in future if necessary.

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