MUMBAI: The legislative branch of the Government of Israel approved a law for the encouragement of production of films in Israel. The law aims at encouraging the production of foreign films in Israel, through a tax benefit of upto 20% on goods and services purchased within the country. However, the benefits by the law accrue to an Israeli production company who is expected to pass on these benefits to the foreign production company.
Passed by the Israeli Knesset, the law recognizes two models. The first model deals with productions by foreign filmmakers in Israel that retain the services of an Israeli production company. In this an Israeli film production company that purchases Israeli goods and services on behalf of a foreign production company, can withhold tax payments of 17%. However, this benefit pertains to films in which the local production costs exceed $2 million. The other model is for Films with Israeli co-producers and co-financiers who own certain rights in the film. In order to qualify for the benefits, the total production expense in Israel must be at least 4 million shekels (approximately $1.0 million).
Viewing the formulation of the law as a positive move towards better International relations Israel Consul General Orna Sagiv asserts, Israel offers film producers a cost effective professional filming package along with a vast variety of beautiful locations. Availability of 5 star hotels and an advanced telecommunications network clubbed with the 20% reduction in cost makes Israel one of the most sought after places for filming.
With the attractive tax benefit, Israel offers producers a compact yet diverse environment, highly professional crews, highest quality filmmaking facilities and modern infrastructure, all at a competitive price. Also, on the platter are state of the art equipments and fully equipped studios, the exotic locales and faces representing a multi cultural society making Israel suitable for filmmaking.
The new law positions Israel in line with most advanced countries in the world.