Treasury Laws Amendment (Delivering Better Financial Outcomes and Other Measures) Act 2024 (67 of 2024)

Schedule 6   Location offset and producer offset for films

Part 2   Location offset conditions

Division 1   Amendments

Income Tax Assessment Act 1997

10   After section 376-25

Insert:

376-27 Minimum training expenditure requirement

(1) A company satisfies the minimum training expenditure requirement for a *film under this subsection if the company incurs expenditure (the training expenditure ) that satisfies the conditions in subsections (2), (3) and (5).

(2) The amount of the training expenditure must be at least the *minimum training expenditure amount for the *film.

(3) Each part of the training expenditure must be:

(a) expenditure that is both:

(i) *qualifying Australian production expenditure of the company on the *film; and

(ii) incurred for, or reasonably attributable to, eligible training that is provided to an individual that has worked on, or is working on, the *making of the film; or

(b) expenditure that consists of payments made (for any purpose) to an eligible provider (other than an eligible provider that is an *associate of the company):

(i) after the production commencement day for the film; and

(ii) before either the making of the film ceases or the company's qualifying Australian production expenditure on the film ceases being incurred (whichever is earlier).

(4) To avoid doubt, the expenditure referred to in paragraph (3)(b) need not be *qualifying Australian production expenditure of the company on the *film.

(5) The amount of the training expenditure that is *qualifying Australian production expenditure of the company on the *film must be at least 50% of the *minimum training expenditure amount for the film.

Meaning of minimum training expenditure amount

(6) The minimum training expenditure amount is:

(a) for a *film with a production commencement day that is on or after 1 July 2024 but before 1 July 2025 - either:

(i) unless subparagraph (ii) applies - the lesser of $250,000 and 0.5% of the company's total QAPE on the film; or

(ii) if regulations have been made for the purposes of subsection (7) - the lesser of the prescribed monetary amount and the prescribed percentage of the company's total QAPE on the film; or

(b) for a film with a production commencement day that is on or after 1 July 2025 - either:

(i) unless subparagraph (ii) applies - the lesser of $500,000 and 1% of the company's total QAPE on the film; or

(ii) if regulations have been made for the purposes of subsection (7) - the lesser of the prescribed monetary amount and the prescribed percentage of the company's total QAPE on the film.

Prescribed amount and prescribed percentage

(7) Subject to subsection (8), regulations made for the purposes of this subsection may prescribe:

(a) a monetary amount (the prescribed monetary amount ) not exceeding $750,000; and

(b) a percentage (the prescribed percentage ) not exceeding 1%.

(8) If the regulations prescribe a monetary amount or a percentage, the regulations must prescribe both a monetary amount and a percentage.

Definitions

(9) In this section:

eligible provider means an entity that either:

(a) offers *tertiary courses; or

(b) is an NVR registered training organisation (within the meaning of the National Vocational Education and Training Regulator Act 2011) that offers VET accredited courses (within the meaning of that Act);

provided that one or more of those courses include eligible training.

eligible training means training or education provided in Australia that contributes to the knowledge, skills or experience of an individual in relation to the *making of *films.

prescribed monetary amount : see paragraph (7)(a).

prescribed percentage : see paragraph (7)(b).

production commencement day , for a *film, means the day that the following commenced:

(a) for a film that is predominantly a digital animation or other animation - the *making of the film;

(b) otherwise - the principal photography for the film.

total QAPE , of a company on a *film, means the total of the company's *qualifying Australian production expenditure on the film (as determined by the *Arts Minister under section 376-30).

376-28 Minimum training expenditure exemption - permanent film infrastructure

(1) A company is exempt under this section from the minimum training expenditure requirement (see subsection 376-20(8) and section 376-27) for a *film if:

(a) the company has materially contributed to the establishment or upgrading of a piece of film infrastructure in Australia (whether or not the establishment or upgrading is complete); and

(b) the film infrastructure is or will be, or the upgrades are or will be:

(i) permanent; and

(ii) reasonable in scale and cost, having regard to the scale and cost of the film; and

(iii) reasonably located, having regard to the needs of the Australian screen industry; and

(c) the establishment or upgrading of the film infrastructure occurs wholly or partly after the commencement of:

(i) for a film that is predominantly a digital animation or other animation - the *making of the film; or

(ii) otherwise - the principal photography for the film; and

(d) if the establishment or upgrading of the film infrastructure is not complete - the establishment or upgrading will be completed within a reasonable period of time; and

(e) the film infrastructure has, or the upgrades have, materiallycontributed to alleviating capacity constraints in the Australian screen industry.

(2) In this section, film infrastructure means buildings or other physical structures that can be used in the *making of *films.

376-29 Minimum training expenditure exemption - training programs

(1) A company is exempt under this section from the minimum training expenditure requirement (see subsection 376-20(8) and section 376-27) for a *film (the relevant film ) if:

(a) an individual (the trainee ) that has worked on the *making of the relevant film has undertaken training under a training program; and

(b) all or part of that training was undertaken by the trainee during the period when the trainee worked on the making of the relevant film; and

(c) the company or an *associate of the company has incurred expenditure that is for, or that is reasonably attributable to, the training undertaken by the trainee; and

(d) the training program has materially contributedto the making of the relevant film; and

(e) the training program has materially contributed, or will materially contribute, to the making of at least 2 films, each of which satisfies or will satisfy subsection (2) (and one of which may be the relevant film); and

(f) the training program has materially contributedto alleviating capacity constraints in the Australian screen industry.

(2) A *film satisfies this subsection if a substantial proportion of the activities involved in the *making of the film take place in Australia.

(3) In determining whether a training program has contributed to a thing mentioned in paragraph (1)(f), the matters to which consideration may be given include, but are not limited to, the following:

(a) mentoring, industry partnerships and work experience placements facilitated by the training program;

(b) skills shortages in the Australian screen industry that are addressed by the training program;

(c) activities connected with the training program that contribute to improving health and safety, and diversity and inclusion, in the Australian screen industry;

(d) any matters specified in rules made under subsection (4).

(4) Subject to subsection (5), the *Arts Minister may, by legislative instrument, make rules specifying matters for the purposes of paragraph (3)(d), including matters of a kind referred to in any of paragraphs (3)(a) to (c).

(5) Before making rules under subsection (4), the *Arts Minister must consult the Minister.