Fulvia Tesio
With the approval of Law No. 207/2024, the face of tax incentives for the audiovisual and film industry is changing.New thresholds, stricter selection criteria, and a stronger role for the state in the management of rights to works have been introduced. More selectivity, public rights, and digitization
With the approval of the 2025 Budget Law (Law No. 207/2024), the Italian film and audiovisual sector is facing a significant change in the regulation of tax incentives, in particular with the introduction of new procedures for accessing tax credits and a strengthening of the public role in the management of rights to funded works.
Reform of Law 220/2016: all articles affected by the restyling
Paragraph 869 of the 2025 Budget Law amends seven fundamental articles of the film legislation, revising funds, credits, selective contributions, and digitization.
The heart of the reform is found in paragraph 869 of the article, consisting of seven letters (from a) to g)), which amends various articles of Law No. 220/2016, the framework law on cinema and audiovisual media. The amendments concern both financial instruments such as funds and tax credits, and cultural and strategic measures, such as digitization and the promotion of audiovisual heritage.
Seven articles are being revised:
Art. 12 – Objectives and types of intervention;
Art. 13 – Investment development fund;
Art. 15 – Tax credit for production companies;
Art. 21 – Common provisions on tax credits;
Art. 26 – Selective contributions for projects of high cultural value;
Art. 29 – Extraordinary plan for digitization;
Art. 32 – Public register of works.
New tax credit regulations for production companies
Flexible rates and differentiated criteria: how the tax credit for producers is changing
The tax credit will no longer be fixed but will vary between 15% and 40%, with access subject to qualitative, size, and territorial requirements. European and independent productions are favored.
One of the most innovative aspects concerns Article 15, relating to tax credits for film and audiovisual production companies. The new mechanism provides for a variable range between 15% and 40% of production costs, leaving ample discretion to secondary legislation through ministerial decree.
Towards a more strategic and meritocratic tax incentive
The 40% ceiling is no longer guaranteed: it will be up to ministerial decrees to calibrate the rate according to the type of work and the beneficiary, emphasizing cultural impact and economic sustainability. Modulation based on quality and size criteria
The credit will be modulated according to objective parameters such as:
Size of the company or group;
Eligible costs and maximum expenditure thresholds;
Type of distribution (cinema, TV, OTT platforms);
Involvement of national broadcasters or international co-productions;
Membership of the European Union and production independence.
This selection criterion reflects a European trend to concentrate public resources on culturally significant and industrially sustainable projects. In France, for example, the Centre National du Cinéma (CNC) has for years adopted a similar system of selective support aimed at strengthening the pluralism of supply.
A specific ceiling is introduced for the remuneration of artistic and technical personnel involved in production.
The aim is to avoid imbalances in the distribution of tax benefits and promote transparency. Towards a 'smarter' tax credit
The 40% cap will no longer be the rule, but the exception reserved for strategic productions. The tax credit thus becomes a smart incentive, designed to reward quality, innovation, and roots in the European industrial fabric.
New common rules for credits: restrictions on professional fees and greater transparency
Substantial changes also affect Article 21, which regulates the common rules for the allocation of tax credits to all entities in the supply chain (production, distribution, exhibition, post-production). Paragraph 869(d) introduces a new limit on professional fees eligible for tax credits.
The limit applies exclusively to production companies;
It is parameterized according to the provisions of Decree Law 201/2011, Article 23-ter;
It takes into account the type of work and the nature of the service (e.g., acting, directing, technical).
The measure aims to prevent a significant part of the tax benefit from being absorbed by high fees, ensuring instead a more equitable distribution of resources throughout the entire production process.
Strategic innovations: state rights, selectivity, and digitization
The state becomes co-owner of rights: the paradigm of public financing changes
The law provides for the possibility of state participation in the proceeds of financed works. This is an absolute novelty in the Italian system, designed to make the film fund more autonomous and self-financing.
1. Rights to works: the state becomes co-owner
For the first time, the legislation introduces the possibility for the state to acquire a share of the economic rights to works financed through tax credits. The economic return from this share will be reinvested in the Film and Audiovisual Fund, with the aim of making the system self-financing and circular.
This measure is based on the German model of the Filmförderungsanstalt (FFA), where public intervention can involve forms of profit sharing.
2. Doubling of resources for selective contributions
More funds for selective grants and promotion: space for innovative and high-quality projects
The share of the Film Fund allocated to direct support for works of cultural value is increased to 30%. This is a clear signal towards the promotion of creative excellence and expressive diversity.
The percentage of the Fund's resources allocated to selective grants and promotion is increased from 15% to 30%. This will strengthen support for:
Works of high artistic and cultural value;
Experimental and independent projects;
International promotion initiatives.
3. Permanent digitization of audiovisual heritage
Continuous digitization: $3 million per year to save audiovisual memory
The heritage digitization plan becomes structural and permanent. A key measure to protect Italian cultural identity and expand the accessibility of our historical audiovisual archive.
The digitization plan becomes structural, with an annual allocation of €3 million starting in 2025. The goal is to ensure the preservation, accessibility, and enjoyment of Italy's audiovisual heritage. This strengthens the commitment to modernizing the sector and preserving our collective cultural memory.
Conclusions: toward a more sustainable and competitive ecosystem
The 2025 tax credit reform marks a decisive step towards a more selective, sustainable, and strategic financing system, in line with virtuous European models. The introduction of flexible rates, public participation in rights, cost containment, and the enhancement of promotion and digitization lay the foundations for a more robust, international, and culturally relevant audiovisual industry.
The Italian film industry, supported but also empowered, is now called upon to respond with quality, innovation, and industrial vision, consolidating its position on the global stage.