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Fiji's Tax Incentive Package Recently Boosted
To 47% ReFunds First Rebate On Bollywood Film
Kaha Delhi; Kaha Lahore Produced By Karan Arora

Pictured...producer Karan Arora and presenting the rebate to him is Fiji's Attorney General and Minister for Industry & Trade (Minister responsible for the FAVC) Aiyaz Sayed-Khayyum on the Minister's left is Florence Swamy and on the extreme right of the picture is the CEO of the Fiji Revenue and Customs Authority.
Sourcing soft money has become an intricate aspect of film financing as the traditional straight funding continues to be scarce, the need for content is unabated, and co-production is now the norm in producing films whether as a major or independent company.

Most Governments, particularly over the past two decades, have been actively promoting their countries as locations and offering tax incentives to attract scarce private capital associated technology and improve managerial skills in order to help achieve their long-term development goals.

Several of the rapidly developing countries have a variety of incentives and/or tax benefits to shooting locally in their domain. These countries see the soft money incentives as a double advantage of an increase in GNP and an opportunity to train and build a film infrastructure to benefit the local community as they strive to preserve their culture through the art of film. Fiji and its Audio Visual Commission have arguably been the most successful.

Fiji's Audio Visual Commission incentives, which started out at 15% and were increased to 35% but with restrictions, are now a very attractive 47% with certain restrictions lifted. All these changes have been driven by demand for the incentive initiative since its inception.

Florence Swarmy, Manager Fiji Audio Visual Commission, in making reference to the audio/visual law that has increased the rebate to 47% of the Qualifying Fiji Production Expenditure (QFPE), which was previously at 35% with restrictions, commented that under the law as long as a company spends a minimum of F$250,000 (approximately US$125,000) of its QFPE in Fiji it still qualifies for the 47% rebate even it films only part of the script in the country.

Florence Swarmy expounded: "Previously a film or television company had to spend a minimum of 35% of their total production budget in Fiji to qualify for a rebate. As an example, the film Kaha Delhi; Kaha Lahore, produced by Picture Thoughts Ltd of Mumbai India was finished early in March and had a total budget of FJ$2,917,234.00, which included a cast and crew of 25 from India, with a 23 day shooting schedule. The production received a total rebate of FJ$1,178,082.94. We have a timeframe we are required to work in and the Company gets paid the rebate within 8 weeks following an audit of the accounts at the completion of the film." She continued: "Other provisions that are a part of the package can go far towards reducing the cost of the production, one of which is the refund of the 15% Value Added Tax (VAT) paid in Fiji."

Commenting on his experience in Fiji, producer Karan Arora of Picture Thoughts Ltd said: "Looking at the global soft money schemes available for film productions around the world, I would short list Fiji tax rebate as the most lucrative and accessible one in recent times. Being the first film in this virgin territory, we had our share of teething problems but eventually the willing authorities and helpful locals made the filming and audit process smooth enough."

Adding to the package, the new law also specifies other items for Qualifying Fiji Production Expenditure, provided the Production company is registered locally or has set up a branch operation and monies are paid from that account. These specific items include salaries of cast and crew, airfares (if the travel is on Fiji's national carrier, Air Pacific), offshore equipment hire and cartage to Fiji and specified amounts for post-production, costume, make-up and props. In addition, The Minister for Finance has also been given the power to waive or reduce the 15% Withholding Tax charged against remittance of salaries of non-resident cast and crew who work in Fiji on the film or television production, provided they are from countries which do not have a double tax agreement with Fiji.

Manager Swarmy, Fiji Audio Visual Commission, concluded, "We have a long history of film and television shot in the country and are well aware of the challenges faced by the production companies. We believe this incentive package, one of the most attract offered anywhere in the world, will be a major encouragement for producers to bring their work to Fiji."
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