Colombia. The Colombian audiovisual industry was on tenterhooks, since the tax reform project, which is being processed by the current government, proposed the elimination of economic incentives for production, but this section was withdrawn in the version that was filed on October 4.
At the beginning of August, José Antonio Ocampo, Minister of Finance and Public Credit, presented the bill for the 2022 Tax Reform, a document that exposed the elimination of incentives for audiovisual production, contemplated in Law 814 on Cinema and Law 1556 on Location.
This proposal generated discontent in the industry and allied public officials, who began to work on a counterproposal and make more visible the benefits that would be lost. Such was the case of Senator Angélica Lozano who, in addition to presenting a proposal to the reform, said:
"Both laws have been decisive for the advancement of our audiovisual industry and have allowed Colombia to become a striking place for producers from all over the world and not to mention the benefits in job creation and strengthening of the entire sector.
Thanks to them, for example, between 2004 and 2022 420 national feature films and more than 1,000 short films were released. Before the issuance of these rules the number of productions was very small."
The support was extensive at the government level, Patricia Ariza, Minister of Culture, summoned the community of actors of this industry to speak at the Teatro Colón on August 10.
For her part, Ana Piñeres, president of EGEDA and executive at GMO Producciones, denied the request that the nation's money be delivered to the large platforms, a situation for which the elimination of incentives was indicated in the first place.
"The platforms are bringing large investments to Colombia, which mobilize the economy and generate foreign exchange. Encouraging investments implies that more taxes will be paid, does not generate a fiscal deficit but an increase in state revenue, and the use of many services that impact many industries.
In addition, the platforms are not given money but tax quotas that are marketed on the Stock Exchange. So, it is a matter of sitting down to dialogue and understanding that the audiovisual industry impacts on the GDP of the Nation and shows our identity to the whole world."
Happy ending for the Colombian industry
Now, returning to the regulatory framework, in relevant data is that Law 1556 was created in 2012 for the "promotion of the cinematographic activity of Colombia, promoting the national territory as an element of the cultural heritage for the filming of audiovisuals and through these, the tourist activity and the promotion of the image of the country" so that its purpose is intimately linked to the development of the film industry, but also of the projection and international relations.
This standard offers "a consideration equivalent to forty percent (40%) of the value of the expenses made in the country for cinematographic services contracted with Colombian film services companies and twenty percent (20%) of the value of expenses in hospitality, food and transport, provided that the conditions established in the resource allocation manual are met."
That is why the reversal of the modification to the incentive was listed as positive news and a 'happy ending' for the tension that the different actors of the industry went through, such as producers, filmmakers, suppliers and locative operators, screenwriters and the actor guild, among others.
Benefits obtained
According to the " Proimágenes Colombia 2021 Management Report", in 2020 13 projects were approved with a projected investment of $212,465 million, by 2021 it reached 27 approved projects, year in which the formats with which they were applied to the incentive were also diversified (3 films, 18 fiction series, 2 documentary series, 4 realities, and 2 projects only for the post-production component).
The quota for 2021 was used in its entirety, leaving as a projected investment in Colombia for $ 677,237 million pesos and projects of the CINA incentive system approved for $ 200,000 million. Given the excellent results for 2022, the quota was expanded to $ 280,000 million for an estimated 65 new projects. To date of the report, 5 projects had been approved with a projected investment of more than one hundred billion pesos.
On the other hand, the data of the "Study evaluation of the effects of the law of promotion of cinematographic activity in Colombia", law 1556 of 2012, presented by Econometría in 2019, during the period 2013-2018, the beneficiaries of the Colombia Film Fund (FFC) hired mostly Colombian technical and artistic personnel (between 80% and 90%).
Likewise, for each job generated in the framework of film services, 2.83 jobs were generated in other sectors (on average), for a total of more than 58,000 indirect jobs in the construction, manufacturing, financial and transport sectors, among others.
The same report contemplated a projection of Proimágenes of an increase in direct employment generated by audiovisual productions since the creation of the CINA incentive, with an estimated 35,200 people hired since 2013.
Finally, according to the agency Invest Bogotá, by July of this year the incentives of the FFC and CINA for the audiovisual sector have achieved investments of 1.5 billion pesos, in 102 approved audiovisual projects, 64 projects in execution (7, to receive consideration from the FFC; 57, to receive CINA certificate), 15 cinematographic works (4 approved to receive FFC; 11, for CINA), 45 series (3 approved to receive FFC; 42, for CINA) and 4 post-production projects (CINA).
