We are frequently reminded that these are financially difficult times, but the scale of the crisis facing Spain's film industry is almost beyond comprehension. After a shock move by the Spanish government that saw ticket prices increase by 13%, the Federation of Exhibitors has warned that as many as 70% of the country's cinemas may face bankruptcy.
The tax changes, made early last week, are only now beginning to hit home. VAT on tickets has risen from 8% to 21%, the highest in Europe, meaning that an average ticket will cost the equivalent of around £12 - just for the film, with no 3D or extra frills. Whilst that might sound manageable, unemployment in Spain is at 24% and a sizeable proportion of the population is struggling to make ends meet. Trips to the cinema might still happen as occasional treats but they are the first things many people cut back on. Box office receipts have already dropped by half over the past two years, whilst film piracy has grown significantly.
Exhibitors have backed down from initial strike proposals and are now in negotiation with the government, but they fear that this change will inevitably cost more jobs. Similar fears have been expressed at the other end of the industry. The Dictator and The Amazing Spider-Man have both been big hits this year but home-grown films face more of a struggle. With key industry facility Ciudad de Luz closing earlier this year amid financial scandal, film production in Spain is in a vulnerable condition, and government funding for is has just been slashed by 50%. The growth of Spanish-language film production in South America is putting it under even more pressure. Now serious questions are beginning to be asked about whether or not its distinctive cultural voice can survive.