Three more Avatar films to be made in NZ

December 16th, 2013 at 12:18 pm by David Farrar

The Herald reports:

The next three Avatar films will be made in New Zealand, the Prime Minister has announced at a press conference with the film’s director .

Mr Key announced this morning that the Government had signed a memorandum of understanding with the film’s makers to secure the multi-film deal.

He said investment would be “significant” – a minimum of $500 million for the three films.

Great news.

I await however Labour and the unions condemning the memorandum of understanding as crony capitalism.

20th Century Fox Hanneman said an undertaking of the scope of Avatar required a significant collaboration between the and Government.

“New Zealand offers unparalleled support to films of this scale.”

Changes to the screen productive incentives will mean Avatar is likely to benefit from a 25 per cent rebate.

Changes to the incentives for both overseas and local film makers include raising the rebates from 15 per cent to 20 per cent – and those which provided extra benefits to New Zealand would get extra ‘points’ entitling them to an extra 5 per cent on top of that.

Economic Development Minister Steven Joyce said he expected the Avatar films to meet that top 25 per cent rebate – the deal includes marketing of New Zealand and substantial local employment.

The Avatar agreement includes committing to a long term relationship with 20th Century Fox, spending at least $500 million on production in New Zealand, including most of the live action shooting and visual effects.

It also commits the film’s makers to ensuring at least 90 per cent of the live action crew are New Zealanders and New Zealand will host at least one of the three premieres.

The Wellington red carpet has never been used so much!

Mr Cameron said he was expecting the films to be released in Christmas 2016, 2017 and 2018.

Again, great news for the thousands of people who work in the screen industry.

Cameron committing to NZ long term is strategically important also as it reduces our reliance on Peter Jackson.

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41 Responses to “Three more Avatar films to be made in NZ”

  1. Manolo (12,625 comments) says:

    Silent T will buy out Cameron and nationalise Avatar too.

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  2. Peter (1,468 comments) says:

    Peter Jackson is an unsustainable resource.

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  3. James Stephenson (1,885 comments) says:

    This is terrible news, foreign money coming in and buying up our film industry…isn’t it Winston? Winston…?

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  4. Samuel Smith (266 comments) says:

    Coated in corporate welfare.

    How on earth does DPF reconcile his governance role at the Taxparers’ Union with his support for the Tory’s corporate welfare schemes?

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  5. mandk (692 comments) says:

    The news could hardly have been better.

    Sadly, the sneering from Sam Smith was entirely predictable.

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  6. dime (8,752 comments) says:

    cunliffe is launching “kiwifilm”. it will be 10 times better than this scam!

    first up, a 3 hour biopic – the life of helen clarke. in 3d!!

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  7. RRM (8,988 comments) says:

    It’s quite simple SS:

    A) You offer no tax incentives; the company does its work somewhere else.
    Net tax take for NZ: $0.00
    Net wages paid to NZ contract workers: $0.00

    B) You offer tax incentives; the company does its work here.
    Net tax take for NZ: $something.
    Net wages paid to NZ contract workers: $something.

    It’s a market, we have to compete to get the work, something that someone like you (who is clearly a civil servant, a student or perhaps a beneficiary) can never understand.

    That’s why there is no option c:

    C) You offer no tax incentives; the company still does its work here anyway.
    Net tax take for NZ: $ a little bit more
    Net wages paid to NZ contract workers: $ the same.

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  8. YesWeDid (1,002 comments) says:

    Seriously 25% rebate?? Didn’t Key say they wouldn’t go above 15%?

    If they spend $500M that is $125M of taxpayer subsidy, even if you say 15% is is the GST refund that is still 10% or $50M that tax payers are giving to James Cameron to make his movies here. Movies that are going to make 100′s of millions of profit.

    Where will this all end, 100% subsidy? Come make you movie for free in NZ.

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  9. Samuel Smith (266 comments) says:

    Sounds like Key was scammed to me.

    They should have sent the master negotiator Tim Grosser in to do the deal.

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  10. mandk (692 comments) says:

    @ Dime
    Then we could have “Parsloe – the movie”. 4 hours, monochrome, with unintelligible dialogue.
    Let’s keep the ideas coming.

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  11. dime (8,752 comments) says:

    “if they spend $500M that is $125M of taxpayer subsidy”

    umm before i trust left wing math,,

    is it a 25% rebate on tax PAID OR a 25% rebate on the overall cost of the films?

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  12. KiwiGreg (3,129 comments) says:

    Only the left can make out that the mugger only taking 50% of your money is somehow offering a subsidy.

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  13. thor42 (773 comments) says:

    This is great!

    Investment of at least $500 million for a “cash carrot” of a fraction of that amount.

    Clearly Samuel Smith can’t do arithmetic. Either that or he would much prefer to see our film industry out of work and everyone in it on the dole or going overseas.

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  14. mandk (692 comments) says:

    @ YesWeDid

    What about the income tax on thousands of salaries and contracts?

    What about the enhancement of Weta’s status as one of the world’s best digital effects companies?

    What about helping to ensure that one the most successful film maker of all time stays in NZ to make further movies?

    What about the promotion of NZ to visitors?

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  15. ciaron (1,157 comments) says:

    The next three Avatar films will be made…

    why?

    just, why?…

    Don’t we get enough tree hugging anti American feces from the green party already?

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  16. KevinH (1,128 comments) says:

    The Life of (brian) Helen.
    Starring H1
    Co starring : the also rans
    Shot on location at the U.N.
    Produced by Shane Jones R18 Content may Offend Sex Scenes and nudity
    Directed by H1 & H3.

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  17. Psycho Milt (1,975 comments) says:

    I await however Labour and the unions condemning the memorandum of understanding as crony capitalism.

    I don’t doubt that Key would like to think of himself as a “crony” of the 20th Century Fox execs, but doubt very much that they would.

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  18. Kimble (4,092 comments) says:

    NZ wants to be a place where businesses want to do business. We ought to try and become the Silicon Valley of large scale movie production. Non-Trilogies need not apply.

    Large productions like this can shop around. NZ’s established film-making community, awesome location, and pleasant life-style will help get a better deal than those trying to start from scratch, because it would mean we would have more on the table in negotiations. But it doesn’t represent enough value that some deal wouldn’t have to be made.

    Discounted tax is perfectly consistent with the libertarian philosophy. It is the non-discounted tax that is inconsistent.

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  19. RF (1,129 comments) says:

    Poor old silent T and red Wuzzel …. all this good news when they are crying wolf.

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  20. Kimble (4,092 comments) says:

    I don’t doubt that Key would like to think of himself as a “crony” of the 20th Century Fox execs, but doubt very much that they would.

    Yeah, because his time as a top executive at a one of the largest and most influential financial institutions in the world left him with an unrelenting desire to ingratiate himself with this weeks flavour of Hollywood douchebag.

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  21. dime (8,752 comments) says:

    Hey lefty trolls – better check with HO to get the latest talking points.

    The chosen one Adern loves this new arrangement and is taking credit for it. I shit you not.

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  22. thor42 (773 comments) says:

    This kind of industry is *great*.

    It’s money for jam. It’s about as clean and green as it gets.

    As far as “bang for the buck” goes, only an oil or gas discovery could beat this (and that isn’t exactly “clean and green”).
    Not saying that I’d be against such a discovery, but the movie-making industry is much better all around.

    @dime – lefties taking credit for this? Bunch of shameless liars!
    Next thing you know, they’ll take credit for having split the atom…..

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  23. YesWeDid (1,002 comments) says:

    ‘is it a 25% rebate on tax PAID OR a 25% rebate on the overall cost of the films?’

    It’s 25% rebate on the overall cost of the films, NZ has paid over $411M in film subsidies since 2008.

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  24. All_on_Red (941 comments) says:

    Sammy Smith
    “They should have sent the master negotiator Tim Grosser in to do the deal”

    As opposed to that master negotiator Michael Cullen who did such a sterling job when he bought Kiwi Rail. What a star.
    Keep posting Snivelling Sam, every time you do, you prove what fuck wits the left are!

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  25. dime (8,752 comments) says:

    “NZ has paid over $411M is film subsidies since 2008.”

    so they made them without paying tax and then the govt wrote a giant cheque?

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  26. Cunningham (746 comments) says:

    YesWeDid (974 comments) says:

    “It’s 25% rebate on the overall cost of the films, NZ has paid over $411M in film subsidies since 2008.”

    Money well spent. It is not just this movie. Its the technical knowledge that arises from this industry. It’s the spin off businesses that have cropped up from this industry. Its the exposure of NZ to the world. Everyone who gets a DVD or Blue Ray will see our beautiful country. It’s a no brainer.

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  27. James Stephenson (1,885 comments) says:

    a 3 hour biopic – the life of helen clarke. in 3d!!

    Well starting with Horror worked for Peter Jackson, so why not?

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  28. davidp (3,320 comments) says:

    Labour are opposed to making any film that Shane Jones can’t wank to. If it doesn’t have some giant tits and a lot of groaning, then Labour aren’t interested.

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  29. enjiner (15 comments) says:

    I have some problems with the logic “We should support the film industry” as the reason for providing massive tax breaks like this. I’ve got no problems with lower taxes, and the film industry is great for the country, definitely.

    But why exactly does film deserve preferential treatment? We have a particularly draconian IT taxation regime, and I’d say IT is probably an even better candidate for an industry that needs promotion. Or is the logic just, “The film industry has less tolerance for being gouged mercilessly by the IRD”?

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  30. Raphael (61 comments) says:

    @enjiner.
    In two words. Foreign Currency.
    By offering a competitive tax rate as an incentive to the film companies to make the film here it means a whole lot of foreign currency is going to coming in to the country to pay for salaries, rent sites, buy/rent equipment. And that does all kinds of good things to a country’s economy.

    For IT there isn’t as much knock on effect to others and generally not as much investment as one film can be. (and that is speaking as someone in IT who would be happy to get a very low tax rate and other incentives to continue churning out code).

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  31. Jack5 (4,222 comments) says:

    Enjiner is right. Why subsidies for the film industry, and not for software, for engineering, for a hundred other industries?

    Posters who slated the power price deal for the aluminium smelter now try to square the circle by impossibly trying to prove that subsidies are free market.

    National is centre-left, no question.

    As for Kiwigreg’s:

    Only the left can make out that the mugger only taking 50% of your money is somehow offering a subsidy.

    That is not correct, Kiwigreg.

    You have to wonder why tax subsidies to the film industry in NZ and other countries have never triggered countervailing import duties in other nations under World Trade Organisation rules. The American film industry seems to have the whole world conned when it comes to subsidies. Perhaps this will change as America becomes less dominant in world trade.

    This quote from Investopedia explains that tax breaks for industries are subsidies, and also explains how subsidies on other industries’ exports can lead to countervailing duties in an importing nation, or require the exporting country to withdraw the subsidy.

    The WTO’s “Agreement on Subsidies and Countervailing Measures,” which is contained in the General Agreement on Tariffs and Trade (GATT) 1994, defines when and how export subsidies can be used and regulates the measures that nations can take to offset the effect of such subsidies. These measures include the affected nation using the WTO’s dispute settlement procedure to seek withdrawal of the subsidy, or imposing countervailing duties on subsidized imports that are hurting domestic producers.

    The definition of “subsidy” in this regard is quite broad. It includes any financial contribution made by a government or government agency, including a direct transfer of funds (such as grants, loans and infusion of equity), potential direct transfer of funds (for example, loan guarantees), fiscal incentives such as tax credits, and any form of income or price support.

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  32. wreck1080 (3,522 comments) says:

    I don’t know if people really understand how awesome this is.

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  33. OneTrack (1,967 comments) says:

    Samuel Smith – “Sounds like Key was scammed to me.

    They should have sent the master negotiator Tim Grosser in to do the deal.”

    Helen Kelly will renegotiate the deal in December 2014.

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  34. wiseowl (576 comments) says:

    The industry I am involved in brings in $600m per year for this country.Hard grind,no subsidies,no tax breaks.
    This agreement is a sick joke.

    Why not subsidise dairying or as has been stated many other export industries.
    Just appalling policy.

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  35. simo (150 comments) says:

    We just might be the best in the world at CG animation at a reasonable price? We aren’t beggars but we do keep pretty good company if a few of these movies earn $1BN> Our high quality product is very good and fits our sustainability profile. Is China an option for James Cameron, don’t think so!

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  36. mandk (692 comments) says:

    @ Wiseowl
    The reason we don’t subsidise the dairy industry is that it is not necessary to subsidise it to keep it here.
    The film industry could all but disappear in the blink of an eye. The dairy industry can’t do that.
    In an ideal world, we wouldn’t offer tax breaks to the film industry, but we don’t live in an ideal world.
    Even with the tax breaks, the country is going to come out ahead.

    btw, what industry are you involved in?

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  37. beautox (406 comments) says:

    Given how tragically bad the first Avatar was. And given that most sequels are worse than the originals, we have something truly dreadful to look forward to : Avatar IV

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  38. Lance (2,309 comments) says:

    @beautox
    So the most commercially successful movie of all time is”‘tragically bad”.

    Wow … are you a wine snob as well?

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  39. ciaron (1,157 comments) says:

    So the most commercially successful movie of all time is”‘tragically bad”.

    Whole orders of magnitude worse than Titanic… i.e. exemplary movie making and craft coupled with a story that just makes you want to have a root canal sans anesthetic.

    Actually, that sums up most James Cameron films.

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  40. deadrightkev (178 comments) says:

    Nothing like a few million in corporate welfare to grease the wheels of commerce. Shame about the other industry businesses that need investment. They don’t make the grade because they aren’t a winner apparently.

    I cant wait to see what the next industry of choice will be if you are lucky enough to be in the A team.

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  41. KiwiGreg (3,129 comments) says:

    @jack5 you are right and I was wrong – I had taken the grant as being essentially the refund of GST etc but it isn’t (at least from my reading of Film Commission material) – it’s just a grant. Given the propensity of governments to fuck up and the fact you are going to have the Film Commission on one side of the table and the best accountants and lawyers money can but on the other this wont end well for the taxpayer.

    The only logic is film making is internationally mobile and it is a bit of a zero sum game – you can have the film made here or not. I dont trust the governments cost-benefit analysis to get the “or not” part right, they fucked up every other time they have “invested” our money.

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