Canary Islands scraps cap on incentives for major film productions

The Canary Islands have eliminated the $54.9m (€50m) cap on film production incentives. 

Productions looking to access the tax rebate will be able to do so without worrying about whether the cap has been collectively surpassed, meaning any film shoot taking place can receive up to $54.9m (€50m).

This is a benefit, particularly for domestic productions. Previously, big-budget Hollywood projects ran the risk of using up the majority of the subsidies. 

The announcement came on April 30, via a statement by the Audiovisual Cluster of the Canary Islands.

The Canary Islands have a wide doubling potential, having represented locations such as Cuba, Morocco, the Sahara, and fictional landscapes in Disney Lucasfilm's Solo: A Star Wars Story.

Currently, Spanish-German co-production Weiss & Morales is filming in the Canary Islands, co-produced by RTVE, ZDF, Portocabo, Nadcon and ZDF Studios.

Recent productions filmed in the Canary Islands include Netflix's One Piece adaptation, Amazon Studios' TV series Wheel of Time, and Marvel's 2021 movie Eternals. Currently filming in Tenerife, Canary Islands is the Paramount+ series STAG, while Guy Ritchie's latest film starring Henry Cavill and Jake Gyllenhaal has recently wrapped filming in the town of San Andrés. 

The Canary Islands offers a tax rebate (compatible with an income tax rate of 4%) of 50% up to $1.05m (€1m) expenditure, and 45% after.

For Spanish productions and co‐productions, at least 50% of the deduction base must correspond to expenses incurred in Spanish territory. For foreign productions, there is a $1.05m (€1m) minimum expenditure in Spain required to qualify for the tax rebate.