Animation Ireland Calls For Extension Of ‘Crucial’ Tax Credit

The country’s competitive tax credit scheme runs out in 2024 and the animation industry’s trade org is asking for a longer-term solution instead of a credit that expires every five years.

Animation Ireland, the business group representing Irish animation studios, has called on the country’s government to extend its tax relief benefits to allow the country to continue to grow its world-class industry.

The current tax gives Irish film and TV producers 32% to 37% (depending where the project is produced) back on qualifying spend up to US$70 million per project. The Irish animation industry has thrived under Section 481 and Animation Ireland says its expiry could put at risk the 2,500 people across 42 studios that currently service the industry.

The plan runs in five-year cycles, with the existing program set to expire December 31, 2024, although an eventual renewal of the credit system is seen as likely by many in the industry. However, due to the lengthy production process required for animation, Animation Ireland is pushing the government to renew the plan as soon as possible.

“What we’re calling for today is the extension of S481 beyond 2024,” Animation Ireland chief executive Ronan McCabe told Cartoon Brew. “Because animation production is a multi-year process, there are decisions being made today about productions that may start in 2022 or 2023 but that will roll into 2024 and beyond. If the government announces they’re going to extend the tax credit, it will give the industry certainty from 2024 to 2029.”

“Any studio in Ireland tends to look a bit like the United Nations,” McCabe explained. “Ireland employs and has access to staff from all across the European Union and as we have a really good reputation for our animation content, people want to come to Ireland to work. There is also a Common Travel and work arrangement between Ireland and the U.K., so there are lots of British staff working here too.”

“There are so many countries and territories offering tax credits around the world that to stay competitive it’s important that Ireland has its tax credits in place and certainty with regard to the extension until 2029,” said McCabe, emphasizing the importance of getting Section 481 extended as soon as possible.

Ireland’s kids animation sector has been on the rise in the last decade. In March, Irish development agency Screen Ireland launched the National Academy Talent for Animation program to increase the number of skilled staff working in the country’s animation sector to meet high demand.