By: Petr Pešek
April 8, 2025 5 min read
The audiovisual industry as a modern industry has been undergoing almost continuous transformation in the recent years. The law reflects these developments and legislators are working to create an appropriate legal framework. The legislative response to the ongoing changes is the amendment to the Audiovisual Act, which entered into force on 1 January this year.
The amendment to the Audiovisual Act brings several fundamental changes to the system of support for Czech film industry. One of the most significant innovations is the introduction of the so-called streaming tax, which expands the circle of taxpayers to include providers of audiovisual media services on demand (VOD, video on demand).
Digital platforms such as Netflix, HBO Max or Disney+ will now contribute to the State Audiovisual Fund (formerly the State Cinematography Fund) with a percentage of their revenues generated in the Czech Republic. In addition to this obligation, the platforms must invest at least 1.5% of their revenues in production in the Czech Republic.
Entities seeking a place in the film production market will also see a change. The Act provides for an increase in the number of film incentives aimed at attracting foreign film productions and supporting the realization of their projects in the Czech Republic. These incentives take the form of so-called “retroactive subsidies”, which allow applicants to recover part of the costs incurred in filming. Originally, up to 20% of the costs could be recognised, but this has now been increased to 25%. In addition to increasing the maximum possible incentive per production from the original CZK 150 million to the current CZK 450 million, the system for calculating the total amount that can be spent on incentives has also changed.
The amendment also extends support to video games and so-called small screen works, thereby making it clear that audiovisual works have long included more than just films.
The amendment aims to positively affect the entire audiovisual sector. The extension of the circle of taxpayers to include VOD platforms and the unification of the amounts to be paid is intended to ensure the stabilisation of the financial resources of the State Audiovisual Fund. The declared aim is to support original Czech works more systematically. This legislation reflects the changes in the way audiovisual content is distributed, with an increasing number of viewers consuming films and series via streaming platforms and traditional production taking a back seat to new trends.
Lawmakers hope that increasing film incentives will strengthen the competitive ability of the Czech Republic as an international film destination. Prague and other locations can thus compete more effectively with other European centres of film production, such as Budapest or Warsaw, which in the past offered more favourable conditions thanks to active institutionalised state support.
The amendment to the Audiovisual Act aims to create a more stable economic environment for the Czech film industry and to reflect current trends in the distribution of audiovisual content, thus contributing to the sustainability and development of the domestic film industry. Despite the undeniable benefits of the amendment, some questions remain open. Topics discussed include the efficiency of collecting levies from foreign streaming platforms or the optimal setting of the incentive system.
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