Harry Potter challenges French cinema tax system

Guillaume Desjardins from CNBC reports on the controversy surronding the premiere presentation of the last instalment of the Harry Potter franchise.

On Tuesday, July 12, around 10,000 Harry Potter fans rallied towards the Parisian concert hall of Bercy to celebrate the premiere of the last episode of the adventures of the world’s most famous sorcerer. But while fans were parading with their magic wands, sorcerer's hats and flying brooms, the French film industry has been up in arms.

Indeed, movie theatres in France are subject to a specific 10.78 percent tax on the price of a ticket. The revenue generated goes to a special fund aimed at financing the production and distribution of French movies. Stadiums and concert halls, such as Bercy, are not subject to this tax.

"It is a quite inclusive—and quite smart—system that allows French cinema to survive thanks to American blockbusters such as Avatar," Florence Gastaud, chief executive of the Societe Civile des Auteurs-Realisateurs-Producteur (ARP), told CNBC.

The ARP is a movie-makers' organization created more than 20 years ago to think about how the sector can be regulated and what needs to be done to help it survive technical and cultural changes. It gathers such famous names as Claude Lelouch, Costa Gavras and Coline Serreau.

With up to 10,000 tickets sold for at least 25 euros (US$35) a piece, it is 25,000 euros that will not end up in French directors' pockets.

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