The potential levy on TV streaming services, a so called 'Netflix levy', which was designed to raise money to fund indigenous Irish productions, is under threat.
Minister for Media and the Arts Patrick O'Donovan said yesterday that he did not see why the levy should be imposed on consumers and would be bringing a memo to cabinet on the matter.
Industry experts say the levy on the streamers is vital to support the creative industries.
The levy policy has been designed to raise money to fund indigenous Irish productions.
It has taken root against a background of growing concerns in domestic TV industries across the world that big streamers like Netflix and Disney+ are skewing the market for localised companies which is affecting homemade productions.
The European law which allows member states to introduce a content levy was passed in 2018.
The purpose of the law was to ensure that streaming services and pay TV services that take money out of Europe could be required to invest a portion of that money back into local creative talent to create local stories for local audiences.
Ireland legislated for the levy in 2022 but never introduced the levy.
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Speaking on Morning Ireland, James Hickey from Screen Producers Ireland said that the levy is necessary to "support the development of Irish stories, drama and animation".
Head of the faculty of film at the Institute of Art, Design and Technology (IADT) Rónán Ó Muirthile said that while the audio-visual sector in Ireland has been under pressure for years, the streamers have certainly added a new dimension to it.
"The streamers have provided amazing content but they are stifling local creations, and have had a damper on native content."
"We need to explore how do we get Irish stories on to screens," he added.
One of the factors causing confusion for the industry is that while Coimisiún na Meán presented the Minister with a feasibility study for an audio-visual content levy and fund in January, its findings have not yet been publicised.
The report was one of the recommendations of the Future of Media Commission report and while James Hickey said that his understanding is that this report supports the introduction of a levy, they still do not know the detail of the report’s findings.
Mr Hickey said that the industry is calling for the Minister to publish the report and they are also seeking a meeting with the Minister and the department.
Supporters of the levy also say that Ireland is behind in addressing this issue.
They point to the levy model that has been rolled out across 16 of the EU member states including Spain, France, Germany, Belgium and the Netherlands.
In Italy, there is a 17% investment obligation while Spain has a 5% levy
France, meanwhile, has a 20% investment obligation and a 5% levy.
In all of those countries there is an obligation on all streaming platforms to contribute to indigenous production.
James Hickey is looking for action in this regard and said that SPI are part of a coalition of industry partners who support the levy including the Screen Directors Guild, Writers Guild of Ireland, Screen Composers Guild, Animation Ireland, Visual Effects Ireland, RTÉ and TG4 who are all in support of this levy introduction.
Patrick O'Donovan said, however, that "people are paying enough" for entertainment while in the view of Daragh Cassidy from Bonkers.ie an introduction of a levy might not get support from the public who are "already paying VAT on subscription services".
He also points to licence fee evasion, explaining that if extra resources are available they should be spent on tracking down licence fee evasion and using that money to help fund local productions in the first place rather than turning to the levy.
"People understand the importance of local production but they pay for it anyway, because when they look at situations including RTÉ getting ‘the bailout’ last year, they may say ‘we pay enough’," Mr Cassidy said.
Dr Roddy Flynn from the chool of communications in DCU questioned the timing of the move.
"We transposed the relevant Article (13) into Irish law via Section 159E of the 2022 Online Safety and Media Regulation Act, and I assume we did so on the assumption that we would actually implement it," he said.
"This is the first time I've heard it definitively suggested that Ireland wouldn't avail of it."
He said that the disruption to the industry will be clear.
"Industry representative groups have been operating on the assumption that it was simply a matter of time before Article 13 was transposed.
"We're talking about potentially quite significant sums of money for the domestic production sector here: the ballpark figure is that such a levy could earn in the region of €25m per annum.
"That's worth more than the Sound and Vision Fund and isn't that fair off the Capital Budget of Screen Ireland."
Dr Flynn rejected the characterisation of the levy being a potential ‘extra burden’.
"In the European countries where it has been brought in, it's levied at between 1% and 2% of turnover.
"But this is not a seperate charge imposed on subscribers: it's a levy calculated on the basis of turnover."
Dr Flynn also outlined his view that that he is unclear about the Minister’s role here in intervening.
"The regulator, Coimisiún na Meán, is meant to be at an arm's length remove from State influence, so that it is independent. It's hard to see how this doesn't interfere with that independence."
