Canada

The Canadian film and television production sector employs 30,000 people directly and contributed C$2.8 billion to the Canadian economy in 1998. The strength of the industry is partly attributable to pro-active government funding and initiatives.

Tax Breaks

The Canadian Film or Video Production Tax Credit was established in 1995 under section 125.4 of the Income Tax Act and offers tax credit on 25% of labour expenditures incurred after 1994 on Canadian projects. The qualified labour expenditure must not exceed 12% of the cost of production, net of assistance.

To qualify for tax credit a production must be certified by the Canadian Audio-Visual Certification Office (CAVCO). To be eligible, a Canadian registered company either through co-production treaty or under the following guidelines should produce the film or video:

1. The production company should be exclusive world-wide copyright owner for a 25 year period after completion and retain a share of revenues in non-Canadian markets deemed acceptable by the Minister of Canadian Heritage.
2. Written proof should be shown that within a two-year period after completion the film would gain a distribution deal.
3. A Certificate of Completion must be obtained within two years after the end of the tax year in which principal photography began.
4. The producer must be a Canadian citizen.
5. The genre of production cannot include news, current affairs, talk show, sports event, game show (unless directed at minors), awards ceremony, reality television, advertising, pornography or a production, in the opinion of the Minister of Canadian Heritage, contrary to public policy.
6. 75% of production and post-production costs must be paid to Canadians.
7. The Minister of Canadian Heritage must allot at least six points on the basis of the cast and crew's nationality. A Canadian director or screenwriter accrue two points each, whilst the two highest paid performers, director of photographer, editor, art director and composer gain one point. Animations are eligible under similar rules, although the director and writer get only one point, and different roles, such as background artist are eligible. In the case of documentary, all creative production personnel must be Canadian.

In January 1999, the Canadian Feature Film Advisory Committee published a report that included recommendations for the abolishment of support of tax breaks to non-Canadian companies working in co-production with Canadian companies. The government has yet to reach a decision about any of the proposals outlined in the document

National Organisations

CANADA COUNCIL FOR THE ARTS

The Canada Council for the Arts was established in 1957 to 'foster and promote the study and enjoyment of, and the production of works in, the arts'. The council allocates grants to film, video and new media artists twice yearly, in April and November. The grants are intended to support artistic expression through innovation and experimentation with form, content or technology across a variety of genres.

NATIONAL FILM BOARD OF CANADA (NFB)

Created in 1939, the NFB is a public agency that produces and distributes films which 'interpret Canada to Canadians'. In 1973, the NFB established Aide au Cinema Independent - Canada (ACIC) in Quebec, which seven years later became the Program to Assist Filmmakers in the Private Sector (PAFPS) in the English territories.

Regional Organisations

NOVA SCOTIA FILM DEVELOPMENT CORPORATION (NSFDC)

Formed in 1990, the NSFDC reports to the Department of Economic Development and Tourism, with the mandate of stimulating production, investment and employment and growth in the Nova Scotia film and video industry.

Tax credit is available for companies with a permanent establishment in Nova Scotia where 25% of salaries are paid to the region's residents and the company's assets do not exceed C$25 million. The credit is calculated at the lesser of 32.5% of Nova Scotia labour or 16.25% of total production costs.

In addition the NSFDC offers support in finding locations and recruiting perssonel.

ONTARIO FILM DEVELOPMENT CORPORATION (OFDC)

In November 1997 an 11% tax break was made available to productions filming in Ontario. The OFDC also invest in Canadian films of US$3 million or less with a maximum 25% of the total budget.

Furthermore, the corporation administers a loan programme and provides a network of support channels for Ontario based producers or investors.

BRITISH COLUMBIA FILM (BFC)

The BFC also offer tax incentive schemes. The Basic Incentive covers 20% of labour costs for BC based production companies with controlling copyright ownership. The Regional Incentive is for 12.5% of eligible labour costs for Canadian companies shooting in the BC area and can be accessed with the Basic Incentive. The Training Incentive is the lesser of 30% of trainee salaries or 3% of eligible labour costs, and must be used in conjunction with the Basic Incentive or Regional Incentive. Eligible labour costs during a taxation year are capped at 48% of total production costs.

In addition BCF offer support funding. In the year ended 1998, this amounted to 71 feature films with a total C$4.1 million invested in 71 productions and C$390,438 invested in the development of 45 scripts

OTHER FUNDING SOURCES

The Societe de Development des Enterprises Culturelles (SODEC) offers a 40% production tax credit for Quebec based producers using Quebec based crews as well as funding film and television. French productions can receive up to 80% of their funding through SODEC.

Other sources include the Yukon Film Incentive Program which offers tax incentives, travel rebates and location assistance; the Alberta Foundation for the Arts (AFA), Manitoba Film and Sound Development Corporation (MSFDC), SaskFilm and Film New Brunswick.

Telefilm Canada

Established in 1968 as the Canadian Film Development Corporation (CFDC) to foster a feature film industry by investing in films with 'significant Canadian creative, artistic and technical content', Telefilm operates a number of production funds including the Feature Film Fund and the Broadcast Fund.

Government subsidies peaked in 1990 at C$145.6 million, and now stand at C$78.2 million p.a. for the years 1998-2000. This level is boosted by licensing revenues and support from other organisations so that the total funds available for allocation in 1999-2000 stands at C$139.5 million.

The percentage of the budget that Telefilm pays varies proportionally to the number of Canadian personel, utilising a point system identical to that employed for certifying tax break eligibility. The average proportion of a budget paid is 32%.