Since 2003 the Belgian State has taken measures to provide tax breaks, under certain circumstances, for firms’ investments in the audio-visual sector. These measures have been transcribed into Belgian law under article 194ter of the Income Tax Code (art. 194ter CIR 1992).
This law has since enjoyed great stability, so positive has its impact been at once for enterprises using the Tax Shelter Scheme, audio-visual professionals and the Belgian State.
Over the past fifteen years, the legislator has made some small amendments, always tending to strengthen the legal framework and simplify the mechanism.
And since 1 January 2015, the reform of the Tax Shelter has come into effect. This has brought significant simplification and greater clarity to the system.
The Tax Shelter has enjoyed uninterrupted success. It has been used by more than 5,000 Belgian companies in transactions that amounting to almost €200 million annually.
The funding collected from Belgian companies finances Belgian or European films whose production expenses are incurred in Belgium. Since the introduction of the Tax Shelter Scheme, the quantity of audio-visual productions shot in Belgium has more than doubled. « The extraordinary journey of the fakir », « L’échange des princesses », « La mécanique de l’ombre », « Odd job », « The African doctor », « Fanny's journey », « Suite française », « The Connection », « Blue is the warmest color », « Nothing to declare » and dozens of others opted to be filmed in Belgium thanks to the Tax Shelter.
The Tax Shelter Scheme has proved its financial effectiveness for the State. According to a study conducted by the Université Catholique de Louvain (UCL) in collaboration with SCOPE Invest, the tax benefit granted to Belgian enterprises is more than off-set by the tax receipts from production expenditure attracted to Belgium.
Hence, having demonstrated its benefits for all three parties concerned (Belgian enterprises, audio-visual professionals and the federal State), the Tax Shelter Scheme has found a lasting place among effective tax measures.