SPAA NEWS

Media Release – ATO Intransigence on Producer Offset Acquittals

20 November 2008

After months of investigation the ATO advised SPAA yesterday that it would not make any changes to the timing of the acquittal requirements of the Producer Offset. This means that the production industry is still locked into the costs of interest payments until the year following the completion of the film or program.

“Effectively the ATO has said no to providing necessary relief from this cost impost. This will distort production schedules, as some producers will ensure completion of the film or program in the last quarter of the financial year. This in turn may lead to bunching, which will place pressure on resources and lead to inflationary pressures on budgets. The ATO has argued it requires political intervention and legislative amendments to the Tax Act. They should have told us this eight months ago when this review was called” aid Geoff Brown, Executive Director of SPAA.

The issue of acquittal has been known to the industry since the Producer Offset legislation was finalised. It has been discussed widely in industry forums and at government briefings on the Producer Offset.

‘We were told to be patient, that efforts were under way to address the issue and that legislative changes would be unnecessary, a cleaner neater way was to be found. I am frustrated and disappointed. A year has passed and the bureaucracy can’t or won’t handle it."

"One of the reasons given is that producers might misrepresent their production end dates. Anyone who works in our business knows and understands the scrutiny involved in the Producer Offset acquittal process. Knowing this, they also know the risks identified by the ATO are non-existent. The ATO have been unhelpful and their comments loaded. Here we go again with the ATO’s bias towards the film industry. I doubt any policy support for the industry from government can be truly effective whilst the responsibility for financial acquittal remains with the ATO.”

”The New Zealand government, in announcing their own Producer Offset scheme was to function as a rebate outside the tax system, has demonstrated there is another way.” Brown said.

“There are other issues surrounding the Producer Offset that need to be addressed to ensure its effectiveness. Adjustments are to be expected given the policy was rushed through ahead of the last federal election. However, if the Producer Offset is to work the government must sideline the ATO completely and look at the NZ rebate model. At the very least, and in the interim, the government must amend Section 376 of the Tax Act to allow producers to acquit the Producer Offset in a timely and responsible manner.” 

For more information, please contact:

Bethwyn Serow - Production Executive, The Screen Producers of Australia
Tel: 02 9360 8988 | Email: bethwyn@spaa.org.au

The SPAA Policy Paper on Producer Acquittal Issue is available from SPAA office or can be downloaded direct from http://www.spaa.org.au/displayindustrynews.cfm