British Columbia Finance Minister Michael de Jong released
a statement this morning regarding proposed changes to BC's
film, television and digital media tax credit programs.
Subject to approval of the British Columbia legislature, the
following changes were announced:
The Basic Production Services tax credit (PSTC) rate will be
decreased to 28% (from 33%) of eligible British Columbia labour
The Digital Animation or Visual Effects (DAVE) tax credit rate
will be reduced to 16% (from 17.5%) of eligible British Columbia
labour expenditures directly attributable to digital animation or
visual effects activities.
The Film Incentive British Columbia tax credit (Canadian content
credit) remains unchanged. Also, the Regional, Distant Location and
Training tax credits available in conjunction with the Basic
Production Services tax credit have not been affected.
Current tax credit rates will continue to apply through
September 30, 2016, allowing time for transition. Transition
provisions included at the end of today's announcement will
operate as follows:
First day of principal photography PRIOR to
October 1, 2016
First day of principal photography
ON or AFTER October 1, 2016
Basic Production Services tax credit
Digital Animation or Visual Effects (DAVE) tax
For episodic productions, if principal photography for the first
episode in a cycle of a television series begins prior to October
1, 2016, then all episodes in that cycle will be grandfathered at
the higher current tax rates of 33% for the PSTC and 17.5% for the
Today's release does not address an equivalent to the first
day of principal photography for animation. Clarification should be
In February's budget announcement, the British Columbia
government stated that there would be some form of decrease to the
provincial film and television tax credits. Today's
announcement confirms the substance of these anticipated changes,
which were triggered by the rising cost of the production services
tax credit. Between 2012 and 2015, British Columbia saw an increase
in spending of more than 50 percent on productions that qualify for
the BC production services tax credit and a record high of
approximately $2 billion in BC production expenditures in fiscal
The provincial government's announcement is an attempt to
strike a balance between the ongoing support of the industry and
protecting British Columbia tax payers. The provincial government
extensively consulted with the film and television industry in
structuring the tax credit changes, with a view to protecting
British Columbia's competitive position.
Today's announced changes are subject to the approval of the
British Columbia legislature and the implementation of necessary
regulations. We will continue to provide up-to-date information
regarding changes to British Columbia's film and television tax
credits as it becomes available.
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Ten days following the election, join us for a discussion with Gary Doer, former Canadian Ambassador to the US, and Gordon Giffin, US Ambassador to Canada under Bill Clinton, to discuss how the new President and Congressional makeup will shape US-Canada relations for years to come.
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