Revenue has issued tax credit payments worth €230m to filmmakers since 2015 as part of the scheme credited with contributing to the success of the Oscar winning-film The Favourite.
Last year alone €95m of payments were processed under Section 481 of the Taxes Consolidation Act 1997, which gives relief at 32% of whichever is lowest of the eligible expenditure in Ireland, 80% of the total cost of production of the film, or €70m.
Production companies use the relief as a credit against Corporation Tax, and if the relief is more than the tax due, Revenue will pay the difference.
The amount granted last year was an increase on the €73m awarded in 2017, and the amounts granted has risen steadily over the past four years.
While in 2015 €17m was granted under Section 481, this more than doubles the following year to €45m.
Period drama The Favourite - which was nominated for 10 Oscars, winning Best Actress for Olivia Colman - was part-produced by Dublin-based production company Element Pictures.
Ed Guiney of Element Pictures told RTÉ’s Morning Ireland that funding from the Irish Film Board and Section 481 tax relief played a role in the film’s success.
“Although we didn’t film in Ireland, we also did quite a lot of the post-production in Ireland, all the visual effects, and we used Section 481 so there was quite a significant Irish help in the film,” he said.
Revenue declined to reveal the value of the tax credit awarded to the producers of the film
While it publishes a quarterly list of companies who have received a payment of the tax credit, The Favourite has yet to appear on this list.
Revenue said the publication is “not a list of all companies and films which have been approved for the tax credit” but of those which have received it.
“Under the provisions of section 851A of the Taxes Consolidation Act, 1997, Revenue is legally precluded from commenting on the tax affairs of any individual or entity,” a spokesperson said.
A Department of Finance Cost Benefit Analysis of the credit for 2015 to 2017 found the Section 481 was a net economic cost to society of €72 million in 2016, “before consideration of the cultural dividend and other unquantifiable benefits”.
However the Department report warned that the “unquantifiable nature of the cultural return to society makes it difficult to capture the entirety of economic benefits associated with this relief”.