Leading Australian producers are calling on the government to honour a 2024 promise to remove a financing blockage facing a growing number of independent feature projects.
The Producer Offset (PO) tax rebate allows up to 40 per cent of a feature’s production costs to be claimed back. However,
above-the-line (ATL) costs, including fees to directors, producers, and principal actors, plus development expenditure, must be capped at 20 per cent of the total budget.
Minister Tony Burke, who has arts among his many portfolios, has promised to remove the cap, but the Treasury is yet to amend the relevant act of Parliament. Burke had also said the change would be applied retrospectively from 1 July 2024.
But producers said this is not good enough.
“No financier is going to accept that; it’s too uncertain, and the books get closed on a film,” said Causeway Films principal Kristina Ceyton, whose credits include Danny and Michael Philippou’s Talk To Me, Jennifer Kent’s The Babadook, Goran Stolevski’s Of An Age, and Dario Russo’s highly-anticipated The Fox.
”We are being punished for success. There’s an urgency to this. Every month that goes by there’s an impact.”
A letter to Burke with some 20 signatories that Screen has seen argues the inaction risks losing ownership of IP, inward investment, jobs, economic activity, tax revenue and the opportunity to build globally competitive screen businesses.
“It’s folly to think you’re going to raise finance for great IP, a recognised director and star cast and keep these costs within 20 per cent, but these three elements of creative excellence are what the market expects,” said Virginia Whitwell of GoodThing Productions, whose credits include Cannes award winner Nitram, which won best film in Australia’s 2021 Academy Awards.
“If a producer is making a film for A$15 million, it’s easy to hit A$4 million in ATL costs, but only A$3 million, or 20 per cent of the budget, would be claimable,” she continued. “Every dollar of finance is extraordinarily hard to find. If a project has a A$400,000 shortfall, it may well fall over.”
In a statement, the Treasury told Screen the intention is to deliver the change. “Timing is subject to a range of competing priorities and constraints, including legislative drafting resources, broader government priorities and the overall legislative agenda.”
Some producers said the problem is particularly acute for larger budget projects of around A$15 million or more, but others said it can impact films of A$6 million or more.
Queensland producer Tom Blackwell is deciding whether to take his next film, described only as a “big film for Australia” to New Zealand which has similar incentives to Australia but no cap.
“The government signalled it would remove the cap, but it hasn’t, and that confusion makes it difficult for producers and makes us look sloppy, including at overseas markets,” said Blackwell, known for Never Look Away, which premiered at Sundance in 2024.
Thirty-four Australian features were made in the 12 months to 1 July 2025, according to Screen Australia. Numbers fluctuate but four were made for more than A$20 million and five for A$10-20 million.
A producer who did not wish to be named said the 20 per cent cap was introduced to guard against inflated fees, particularly for key offshore cast.
