Breakfasting with a producer this morning, I heard the nasty rumor that the new US tax bill has a 100% first year depreciation for the costs of making certain kinds of independent films, instead of the usual depreciation over the expected lifetime of the asset. (No doubt the Gubernator had some input here.) Through the intricacies of the tax code, this amounts to the same value to the producer, more or less, as the 9% UK sale/leaseback deal of blessed memory, the one that prompted so many Canadian/UK/xyzzy co-productions.
Together with the Canadian dollarette hitting 85 cents, this is not good news for the Canadian feature film industry.
In fact, on the face of it, it could wipe out the reasons for service deals, i.e. American features shot here because it's cheap. At 85 cents, Canada isn't cheaper, especially not if the US producer can knock off 10% of his production costs for shooting in the US.
Still up in the air whether this hurts Canadian content product, where we still have the nifty 25% federal + provincial subsidies. Those are still among the best deals around because unlike other production incentivies (e.g. the South African production incentive deal), you know that in Canada, if you follow the rules, you get the dough. So you can bank the money. No one will give you cash now for a South African incentive on the if-come because it may not come.
So that's good for me, because my stuff is Canadian content.
On the other hand the Canadian industry dying would be bad for me.
My producer friend however thinks that too many people's jobs depend on Canadian production for the government to let the industry wither on the vine. So they will have to up the subsidies, he thinks.
From his mouth to God's ears.
And, after all, all Western countries except the US subsidize their indigenous drama. So maybe Canada will find a way.
In the mean time I'll keep my fingers crossed. I really don't want to have to go back to LA.