Filming in Hungary – How State Support Affects Domestic and Int’l Filmmaking

Hungary, located in the heart of Europe, is quickly becoming perhaps the most important location for the global film industry in the region. However, while in most western countries, film production is profit-oriented, state patronage also plays an important role in bringing new works to the silver screen here, according to a report published on Merce.hu.

It is important to consider that the market for domestic movies is quite narrow due to relatively high production costs and linguistic reasons.

According to the Film Distributors Association, there were only five Hungarian films between 2012 and 2020 that managed to sneak onto the list of the 100 most watched movies. These films were “Bet on Revenge” (2017), “A Kind of America 3” (2018), “The Whiskey Bandit” (2017), “BÚÉK” (2018), and the Oscar-winning “Son of Saul” (2015)

Global streaming services make the competition even more unequal, as films made in a language spoken by few people with local cultural references are at a considerable disadvantage.

However, this does not mean that the Hungarian film industry is in a dire situation. The country is embedded in the global filmmaking bloodstream via the increasing number of foreign productions shot here.

Tax Breaks and Cheap Labor

Among other factors, Hungary is an attractive production location mainly because of the film tax credit, which since 2018 allows 30% of production costs declared in Hungary to be reclaimed. This is one of the most favorable schemes in the world. Thanks to this, “Blade Runner 2049” received about HUF 7.1 billion in support, while the popular The Witcher series claimed back HUF 3.5 billion. In comparison, the most expensive Hungarian film, “Bet on Revenge” was made with only HUF 2.9 billion.

In addition, unlike the film laws of many other countries, there is no examination of whether the film has a Hungarian aspect or what percentage of Hungarian participation is involved.

The costs of labor are also lower than in the United States for example. While the salaries of Hungarian crews are considerably lower, the working hours are long, meaning a 5-7 day working week with often more than 12 hours of work. However, despite the grueling, long days, there is little chance of Hungarian staff applying successfully for creative and department manager positions, as most productions bring their own people for these tasks.

These productions are estimated to employ about three-quarters of the 10,000-20,000 people in the Hungarian film industry. Still, these large-budget foreign movies also have a knock-on effect on Hungarian films. The salaries of foreign films drive up wages to some extent, making many professionals almost unaffordable for Hungarian films with comparatively low budgets.

But the Hungarian film industry needs these big buck productions to stay successful. According to an article published in Metropolis, “direct Hungarian spending on international productions exceeded HUF 100 billion in 2016 and has remained at this extremely high level ever since.”

The Hungarian Film Fund

When the government decided to set up the Film Fund in 2011, the Hungarian film industry came to a complete standstill for two years. The market share of Hungarian films in the Hungarian cinema market fell from 5-13% in the previous four years to 2-4% and only in 2017 did the annual audience share reach the 2008 level again.

The mandate of Hollywood legend Andrew G. Vajna, a producer promising the American system and meritocracy, as a government commissioner was for an indefinite period, as were the members of the Jury he appointed. Here, three of the five were not replaced until 2019, and the other decision-makers were rarely changed. Thus, it was mostly the same people who decided on the criteria and opinions of the films of a decade.

Meanwhile, Hungarian film production was also in quantitative decline: in 9 years, the Film Fund released a total of just 90 feature films. Few filmmakers received funding for more than one film – only Gábor Herendi had three projects financed. Professionalization has further narrowed the field of applicants: calls for proposals have been limited to fiction films – “in a one-stop shop there is no room for other film initiatives (docs, shorts), there are few animated films and the film magazines are dying, without which there is no real film public life”, said a screenwriter who spoke anonymously to the magazine Prizma. This was confirmed by Béla Tarr, who added underfunding of art cinema to the list. Within fiction films, the Film Fund has more openly encouraged the entertainment direction than ever before.

However, despite the shift towards the more light-hearted entertainment genre, it would be an exaggeration to claim that the Hungarian film industry is based on a purely “neoliberal” foundation. Hungarian films have still not been able to sell beyond the borders of the nation-state, apart from a few exceptional cases, like Oscar winners. The report highlights that in the absence of profit, and with modest revenues, the state and the directors gain mainly symbolic capital, legitimacy, and credibility.

The Leviathan of Three Different Film Industries

There are essentially three Hungarian film industries living in one body.

One is made up of the work of Hungarian filmmakers, some of which are produced with significant financial and symbolic support. Apart from easily digestible comedies and action flicks, films in this category often channel a kind of nationalistic sentiment. A good example is “The Cost of Deception”, with an IMDb score of 1.5, which was released in the heat of the 2022 election campaign, recalling the police brutality seen during the 2006 protests while also acting as a hit piece against opposition left-wing politicians Ferenc Gyurcsány and Klára Dobrev. Other films, still in production, such as “Petőfi”, recall a heroic era from the Hungarian past appealing to a sense of unity among the populace.

The second variant is the industry acting as a profit-maximizing assembly plant where the biggest films from Warner and Disney and the biggest series from Amazon, Paramount, and Netflix are made.

Still, there has been a change in the alternative Hungarian film industry, which represents the third part of the movie business in Hungary, at least in terms of quantity: since 2012, one in three feature films has been non-state funded, with an average of six films a year. As Ákos Schneider writes in his study published in 2018, the “overall quality of independent films (narrative, credibility, acting, cinematography)” and their international recognition have also improved. Nevertheless, the field of independent film has been marginalized. And not only in the communication of the Film Fund, but also in the public media and public discourse.

The article concludes that even today, despite the quantitative growth, there is no formal organization of filmmakers striving for relative autonomy, even though the need is there.

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