Filmmakers demand Japan fix uncertain tax breaks as government merges film policy

Filmmakers are pressing the Japanese government to make its production tax breaks more predictable, arguing that current rules discourage international shoots. The comments arrived at the Motion Picture Association seminar during the Tokyo International Film Festival, just as the state prepares to consolidate fragmented film support into a single agency. The core conflict involves the tension between attracting global productions and protecting local industry standards.

Alex Boden, the London-based producer who spent two years in Japan for HBO Max’s “Tokyo Vice,” traced the incentive’s evolution from a 2020 research program to the current IP360 scheme. IP360 offers a 50% rebate on spending in Japan. Boden noted that the minimum spend requirement has risen to 800 million yen, or 5.1 million dollars. He stated that this threshold excludes independent films and co-productions, as most domestic Japanese films cost between 1.5 million and 3 million dollars.

Boden criticized the subjective nature of the approval process, which relies on panels rather than automatic criteria. He noted that projects often take three to five years to develop, making uncertainty a major barrier. “So how does a producer know that they can count on the Japan incentive in advance? That's the question, and he said. He cited Martin Scorsese’s “Silence,” “Pachinko,” and “Shōgun” as examples of Japan-set projects that scouted locations but filmed elsewhere.

Deb Richards, Netflix’s production policy director, emphasized that clarity matters more than the size of the rebate. “You can have a lower incentive, that's fine, as long as it's certain, as long as the criteria are clear,” she said. She described the current system as opaque, noting that applicants often only learn why they were rejected by comparing their cases with approved projects.

Paul Muller, the MPA’s vice president of production policy for Asia-Pacific, pointed to Australia’s model. Australian productions must spend at least 20 million Australian dollars and direct 1% of their budget to training. Muller said this rule has driven more than 20 million Australian dollars into training since June 2023. He also noted that the cost of an hour of Australian television has risen from 2 million Australian dollars to between 5 million and 6 million Australian dollars over the last eight years.

On the government side, Nakahara Hirohiko, director-general of the Cabinet Office’s Intellectual Property Strategy Promotion Secretariat, confirmed that a task force for the new entity met for the first time on October 22. The body, ordered by the Prime Minister, aims to break down barriers between the ministries currently handling content policy. The government intends to launch the agency in 2027.

The initiative is part of a public-private roadmap targeting 20 trillion yen, or 127 billion dollars, in overseas sales by 2033. Content is one of 17 strategic fields in Prime Minister Takaichi Sanae’s growth strategy. Amari Akira, a former METI minister, described the plan as an effort to quadruple the industry in ten years. Muller said the goal is achievable if the government delivers the discussed changes to the incentive structure.