Outsourcing film locations has recently become a common practice in the film industry. Motivated by the need to cut costs in production, the change in filming location from America to an international location involves hiring companies to secure suitable places for a production that benefit the company in terms of their budget and what the specific location has to offer. Specifically for film production, taxes have been so costly that numerous movies are filmed at entirely different countries rather than filming at local America. From location scouting, to management and permits, to finally filming a movie, these decisions in destinations for producers allow movie companies financial advantages and additional creativity by seeking regions that offer great benefits, even when those places are far overseas.
Different countries around the world offer a variety of distinguishable advantages for film production. Diverse locations allow for more backdrops, changes in environment and can determine how much a studio spends on their movie. In the film industry, the cost of film production varies depending on the location the movie is filmed. What is shocking is that somewhere fairly local, in this case America, tends to cost significantly more than a faraway country like Ireland.
Depending on the type of movie, small independent films can be made for as little as $10,000. Short films, such as a 10-minute movie, could cost between $7,000 and $15,000, which is approximately $700 to $1,500 per minute. On the other hand, the average production cost for major studio films is around $65 million. With total costs combined, a movie can potentially reach $100 million or more with the additions of advertising and marketing. In summary, the bigger the studio, the more money is spent.
In terms of American location, typically, California is known for its consistent use in movies today. The recent “Superman” and “F1: The Movie” were filmed in America, each with huge budgets. “F1: The Movie” was estimated to have a budget of $200-300 million in California. In other popular US states for filming, it cost over $225 million for “Superman” to be filmed in Georgia and $280 million for “Thunderbolts.” Movies overseas, like Ireland, had significantly reduced budgets based on film location. “Small Things Like These” was filmed primarily in Ireland and had a small budget of $3 million. “The Banshees of Inisherin,” released in 2022, had a budget of $20 million for filming in Ireland as well.
Why is it much more expensive to film in America versus traveling overseas to film in another country? Because California has such a high cost of living, the costs to film there are much higher in comparison. As a result, these higher costs lead to studio rental rates going up, fuel prices being higher and other production necessities being affected.
Specifically in Los Angeles, permit fees can add up to a high price; one day of filming in Los Angeles can cost up to thousands of dollars. Permit costs can increase to extra charges for public property use, required public safety personnel needed there and location-related variables like parking.
Tax incentives play a huge role in determining film production costs. The most common incentive offers a percentage of the film’s expenses back to the movie company as a credit on their taxes. This is done to attract productions and stimulate local economies for the better. When a movie is filmed at a popular location, that location’s profits from what they offer can significantly increase due to its role in a successful piece of media, further improving the economics of that area. Tax incentives help to promote the location that will additionally promote tourism, create jobs and contribute to the long-term industry growth. The problem is that California fails to match the much more aggressive incentives offered by competitor locations. Countries like Ireland offer generous tax credits that reach or exceed 40% of production costs, plus, production companies see themselves benefiting from countries with weaker currencies.
Through all of these complications, filming overseas is seen to better benefit the film industry with multiple impacts towards the economy. It isn’t just the movie companies benefiting from paying less. With the involvement of tax incentives, effects such as attracting productions, tourism, brand promotion, job creation in the community and injecting immediate revenue to the location’s community are all positive results of outsourcing film locations.
