In light of the current economic circumstances, and to stimulate Quebec’s film and television industry, the government of Quebec announced, on January 14, 2009, improvements to the refundable tax credits granted on labour expenditures for Quebec’s indigenous film and television productions. These modifications apply only to Quebec film and television productions, and not to film production services.
Firstly, the percentage of credits available on labour expenditures has been modified. The base rate was increased from 39.375% to 45% for single feature films, medium-length and short-length films, single documentaries, children's productions produced in French and big-screen films. For all others eligible productions not included in the above-mentioned list, the base rate, formerly fixed at 29.1667%, increased to 35%.
Secondly, some indigenous productions not receiving any financial assistance from public organizations, are eligible for a 10% increase in the tax credit rates, in addition to the base rate adjustment referred to in the previous paragraph. To receive the additional 10%, the production must be a fictional feature film of at least 75 minutes in length, or a single documentary of at least 30 minutes in length, unless the movie is intended for a public audience under the age of 13. An additional bonus of between 10% and 20% may be granted to specific kinds of productions being filmed outside Montreal, and for productions containing computer animations and special effects.
Finally, the cap on tax credits, which was fixed at $2,187,000 per project, has also been eliminated. The current maximum rate of tax credits on labour expenditures is now 65%, an increase from a previous 48.5625%. As the cap on labour expenditures eligible for tax credits remains at 50% of total production costs, the tax credits cannot exceed 32.5% of total production costs.
These new measures came into force on January 1, 2009 and were confirmed in the 2009-2010 Quebec Budget, which was handed down on March 19, 2009.
As far as film production services are concerned, SODEC’s certification procedure has been simplified by eliminating the final certification stage. In addition, to simplify the application for the tax credits, SODEC will now issue an approval certificate to the owner of the copyright of an eligible production. Finally, the tax credits for film dubbing, formerly fixed at 29.16667%, has been increased to 30%.