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So this is why Uwe boll get's the license on making movies
Posted: Tue Jan 17, 2006 11:15 am
by reefsurfer
.. based on games.
From what I understand, the reason Uwe boll can get away with committing mass murder of brain cells through his crappy movies is because of a loophole in Germany in regards to raising money for films. Apparantly, and correct me if I am wrong (which I might be), his backers pay Uwe money for the film, which they can get as a tax right off. So really, it doesn't matter if the movie flops, because no one really loses any money.
Is this true?
Posted: Tue Jan 17, 2006 11:23 am
by MKJ
it is. also, jackal posted that analysis about how gameliscenses are very cheap and create a boost in blahblabla.
see jackal for more
Posted: Tue Jan 17, 2006 11:41 am
by 4days
Is it true that the germans are looking at changing the law because of uwe boll's anti-talent assault on cinema?
someone mentioned it in the pub the other day, but i hadn't seen the story anywhere so filed it under 'too good to be true/probably bollocks'.
Posted: Tue Jan 17, 2006 11:59 am
by SplishSplash
This is 2002 calling, we'd like our news back.
Is it true that the germans are looking at changing the law because of uwe boll's anti-talent assault on cinema?
More likely because he made that loophole famous.
Posted: Tue Jan 17, 2006 1:04 pm
by Jackal
Funny story I came across while researching this topic. Uwe Bol has his own distribution and production company for his films. This company actually shipped 50 000 copies of Bloodrayne to theatres who didn't even want it, costing him millions of dollars.
Posted: Tue Jan 17, 2006 3:11 pm
by reefsurfer
Jackal wrote:Funny story I came across while researching this topic. Uwe Bol has his own distribution and production company for his films. This company actually shipped 50 000 copies of Bloodrayne to theatres who didn't even want it, costing him millions of dollars.
jesus!
Posted: Tue Jan 17, 2006 3:53 pm
by [xeno]Julios
I still don't understand all this shit
if i'm an investor, and i give you a million dollars to make a flop, how is that going to benefit me or you?
sure i may be able to write off that million dollars off from taxation, but how can the benefits of writing off a million dollars of taxation outweigh the actual million dollars?
i posted these questions in another thread, but nobody seemed to be able to answer it...
Posted: Tue Jan 17, 2006 4:19 pm
by 4days
SplishSplash wrote:Is it true that the germans are looking at changing the law because of uwe boll's anti-talent assault on cinema?
More likely because he made that loophole famous.
thank you for that vital level of extra clarification.
looked it up and there are plans to get rid of 'Medienfonds' - but they're more inspired by hollywood using german investors than the jets of pebbly arsewater uwe boll commits to film - also, the law may not change just yet because the german parliament have other things to worry about.
jules, try this:
http://www.slate.com/id/2117309
might explain things.
Posted: Tue Jan 17, 2006 4:32 pm
by [xeno]Julios
tx - i still don't get it at all though - i don't have a very comprehensive understanding of how financial systems work.
Can someone just explain it to me in a way that doesn't presuppose any understanding of tax shelter, tax deductions, etc.?
My problem is understanding where the damn money comes from!!
It can't just magically appear - and if it comes from someone, how do they profit if the movie flops?
Posted: Tue Jan 17, 2006 10:25 pm
by IW Coriolis
I think it works like this:
Most years you make $1 million, but this year you somehow made $3 million. Maybe you're in a business cycle where your profits are concentrated every few years; I know that game development is kind of like this for individual studios.
Anyway, you're going to pay taxes on all that money. The tax dodge doesn't change this. But, it does change when you pay those taxes. If you put $1 million of that $3 million into a movie, you get a $1 million tax deduction this year, so that you only pay taxes for the $2 million bracket. You make back your investment of $1 million another year, in which you only made $1 million, so you are again in a lower tax bracket.
So, you still pay taxes for the full $2 million extra you made, but you did it in a lower tax bracket over 2 years. The money you didn't spend in taxes counts as a profit. It's not free money, it comes out of the pockets of the governments that put the loopholes in their tax laws.
Posted: Tue Jan 17, 2006 10:37 pm
by dzjepp
BloodRayne looks like the worse movie in the history of cinema... not even that terminatrix chick could save it.
Posted: Tue Jan 17, 2006 11:16 pm
by feedback
The first time I saw a preview for bloodrayne, I thought it was another of those shitty histolical fantasy action-shows the WB pumps out, only for some cable network. Later, I remember watching a preview for bloodrayne on TV, and I thought "hey, this looks a little better than it did before" and then the preview says" UNDERWORLD: EVOLUTION" and I'm like oh
Posted: Wed Jan 18, 2006 1:47 am
by [xeno]Julios
IW Coriolis wrote: You make back your investment of $1 million another year, in which you only made $1 million, so you are again in a lower tax bracket.
right - but what if the movie flops terribly and doesn't recover its profit?
according to another article i read, ppl still profit off this!
Hollywood often complains about box office slumps. They blame piracy, they blame DVD sales, they blame anyone and anything but themselves. You see Hollywood’s a bit like North Korea, if they ever admitted that the regime they run was flawed and oppressive the people at the top of the tower would come crashing down. So, like any good regime, they choose to blame their failures on the peasants for either not submitting a big enough offering or stealing from the state. The savvier public, however, blame an endless onslaught of mediocre, hollow projects that are touted as remakes, sequels, prequels, re-imaginings, reinventions or video game adaptations. To me that’s just a whole lot of different ways for marketing people to say “lazy recycled crap” but I digress.
But ask yourself this; what if you discovered a miraculous way to make a profit from making these bad movies? An ingenious way to guarantee that if your movie flops, you’ll actually make money. Wouldn’t a box office slump be the perfect climate for you; slipping your bad movies into a world where blockbusters are failing weekly? If it flops, the studios will blame the ticket buyers for not buying or the “illegal” downloaders for stealing instead of you for intentionally sucking. Meanwhile, you sit back safe and secure in the knowledge that while your project drops out of the 300 theatres it was showing in after 2 weeks, it is actually making you a mint. Sound unlikely?
Not as unlikely as you’d think... especially if you’re name is Uwe Boll.
http://www.cinemablend.com/feature.php?id=209
see this thread:
http://www.quake3world.com/forum/viewtopic.php?t=14188
Posted: Wed Jan 18, 2006 2:13 am
by IW Coriolis
I still don't understand it fully. That article alluded to the law that you can take out a loan, deduct that money, finance a movie and deduct it again, then you don't pay taxes until the movie makes a profit.
So, let's see how this works. I make $10 million. My tax rate would be 50% (for easy math). I take out a $1 million loan, and finance a movie for $1 million. This gives me $2 million in deductions, so I only pay $4 million in taxes instead of $5 million. I still have to pay that $1 million loan back, so I pay out $5 million either way and end up having $5 million for myself. However, I think they suggested that the loss of the movie is also deductable, so if the movie only makes back half its production costs then I can write off another $500K and I end up making $250K by the movie flopping.
If, instead, the movie does make money, I'm in even a better situation. I pay back the $1 million loan with the $1 million I make to recover the investment. But this first $1 million is tax free under german law; f the money takes in double its cost then I make $2 million but only pay taxes on the second $1 million. So I end up making $11 million over the year and pay taxes on only $9 million of that because of the $2 million in deductions. That untaxed $2 million nets me $1 million more in my pocket.
Posted: Wed Jan 18, 2006 2:28 am
by [xeno]Julios
wow thanks - i think i have a better understanding now
good to see u back on the forums btw
Posted: Wed Jan 18, 2006 4:39 am
by R00k
Did Germany really create this law just to help out bad filmmakers?
So in US terms, this is basically like using an offshore tax haven to not pay taxes. Because surely you can't be refunded for making a $10m flop of a movie if your income is only $2m for that year, right?
In other words, he can't be making real profit, only massively offsetting his tax burden - to the point of not paying any probably.
Right?
And the bigger the flop, the bigger his tax break.
Posted: Wed Jan 18, 2006 7:59 am
by Eraser
R00k wrote:Did Germany really create this law just to help out bad filmmakers?
Probably to stimulate german movie creation. Cultural investment. Now it's exploited by hollywood bigwigs.