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Switzerland: Approval of 4% tax on streaming services referred to as ‘Lex Netflix’

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Switzerland is the latest European nation to implement measures to support local television and film production and increase locally produced content.  

 

On Sunday, May 15, Switzerland conducted a national referendum on a proposed legislation to amend Lex Netflix.’ The amendment requires streaming services to reinvest 4% of their local income in Swiss film and television productions. This applies to global TV streaming giants such as: 

 

  • Netflix, Inc. 
  • Amazon Prime Video  
  • Disney+ 

 

According to the final tally, a little more than 58% of voters supported the proposal in one of three national votes conducted under the Swiss form of direct democracy.  

 

This outcome demonstrates the cultural significance of filmmaking in Switzerland,” Swiss Interior Minister Alain Berset stated at the press conference. 

 

What is the “Lex Netflix”? 

 

Lex Netflix”, which means Netflix law in English, is a Swiss rule that requires television broadcasters to re-invest 4% of their revenue in the Swiss film industry. The legislation is modelled on European Union standards. This is causing quite a stir since the country is not a member of the EU.  

 

Since 2007, national television broadcasters have been required to invest 4% of their revenue towards Swiss film production. Now, streaming providers must adhere to the 4% regulation. Investing may include: 

 

  • the purchase of locally produced shows,  
  • the creation of shows, or 
  • contributions to an investment fund. 

 

It is an effort to catch up with changes in the usage of audio-visual media. In Switzerland alone, streaming networks such as Netflix, Amazon Prime, and Disney+ generate hundreds of millions of euros annually. 

  

The Swiss cultural ministry generates around CHF 105 million (approximately EUR 101 million) a year. They are anticipating that “Lex Netflix” will pump between CHF 18 million and CHF 30 million in the Swiss film and television sector. 

 

 

Other country developments with streaming service taxes and investment requirements: 

 

  • France and Italy mandates streaming service providers a local investment of up to 20% of the revenue on European-language content. 
  • Portugal – streaming service providers are required to pay 1% of their revenue to the Institute of Cinema and Audio-visuals 
  • Spain is scheduled to implement one. 
  • Denmark considering a 5% tax. 
  • Romania proposes a tax to support local filmmaking. 

 

 

Source: admin.ch 

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