The film tax credit system in Italy was introduced in 2008 with Law 244/2007 (Financial Law 2008) and later reorganized by the Cinema Law of 2016. Its aim is to incentivize the production of Italian films and international co-productions, offering a tax credit of up to 40% of eligible expenses. In addition to production, the system has expanded its support to include distribution, promotion, and post-production, contributing to the international competitiveness of Italian cinema.
With the 2025 Budget Law (Law 30 December 2024, No. 207), a significant modification has been introduced to the film tax credit system. The new regulation allows the state to acquire a share of the economic rights of works funded through the tax credit, which will then be reinvested into the Film and Audiovisual Fund, making the system more self-sustaining.
The Italian Chamber of Deputies is discussing a proposal to create a €2 million fund aimed at supporting first-time filmmakers. The initiative is designed to foster new talent and support innovative projects in the Italian cinema industry. The proposal also introduces a progressive tax credit system, which offers varying incentives based on the production budget: 40% for films with budgets under €2.5 million, 30% for those between €2.5 million and €5 million, and 20% for budgets above €5 million.
In addition, a few months ago the Ministry of Culture has intensified its oversight of tax credit allocations, revoking €66 million in previously granted credits and rejecting €22 million in new requests. The new measures require more stringent documentation for eligibility, including certification of at least 40% of production costs with private resources and independent cost assessments.
These changes aim to ensure a more transparent and responsible allocation of public funds. While the new system is designed to support independent productions, there are concerns about balancing support for smaller films with ensuring proper financial oversight.
This initiative marks a crucial step toward reforming Italy’s cinema sector, promoting creativity, and enhancing global competitiveness. The debate in the Chamber is ongoing, with further developments expected.
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