Tax benefits for filming in India operate across two distinct tracks: a central government cashback scheme administered through India Cine Hub under the Ministry of Information and Broadcasting, and state-level subsidy policies that each producing state manages independently. In 2025, the gap between states has widened sharply. Madhya Pradesh notified a new Film Tourism Promotion Policy in February 2025 offering up to ₹10 crore for international productions — the highest single-project ceiling among Indian states and a figure large enough to influence location decisions on large-budget shoots. Rajasthan responded with its own updated 2025 policy.
Uttar Pradesh, Maharashtra, and the South Indian production states continue to run parallel schemes. A production that structures its qualifying expenditure correctly can access the central ICH scheme and a state-level subsidy simultaneously. This page maps the full architecture: what each scheme pays, who administers it, what the minimum spend thresholds are, and how a line producer integrates incentive documentation with the operational production plan.
India’s Film Incentive Architecture — Two Tracks, One Framework
The central government scheme is administered by India Cine Hub (ICH), formerly the Film Facilitation Office (FFO), operating under the National Film Development Corporation (NFDC) within the Ministry of Information and Broadcasting. It applies nationally — a production shooting across Madhya Pradesh, Rajasthan, and Mumbai accesses the central scheme through a single ICH application covering all Indian expenditure combined. The state schemes operate independently: each state administers its own rebate and subsidy programme, with separate application windows, separate qualifying expenditure definitions, and separate disbursement authorities. A production does not need to choose between the central and state tracks. Eligibility for both is determined by spend thresholds and shoot percentages, not by a prior election between them. The full state-by-state comparison of rates, caps, and eligibility conditions is mapped in the film production incentives Indian states comparison guide.
The filming permissions framework required for both central and state incentive access — MIB clearances, state government authorisations, ASI monument permits, and Union Territory administrative approvals — runs parallel to the financial claim process. Productions that let the permit track and the incentive track diverge during pre-production typically create documentation gaps that delay or reduce final disbursement. The India filming permissions framework covers how permit compliance and incentive documentation are managed as a single integrated system from the pre-production stage.
What Counts as Qualifying Indian Expenditure
Under the central government scheme, Qualifying Indian Expenditure (QIE) is defined in the revised guidelines notified by the Ministry of Information and Broadcasting in November 2023 and updated in February 2024. Eligible categories include wages and salaries paid to Indian nationals employed on the production, location fees paid to Indian authorities or private landowners, studio and facility hire from Indian entities, equipment hire from Indian vendors, post-production and visual effects work completed in India, and accommodation and transport costs incurred within India for Indian crew. Expenditure paid to foreign nationals — including foreign director fees, international cast payments, and overseas equipment imports — does not qualify. The QIE calculation is the base against which the 30% rate is applied, making vendor selection and payroll structuring the primary financial variables the line producer controls.
State schemes apply their own qualifying expenditure definitions to in-state spend only. A production shooting across Madhya Pradesh and Rajasthan files a central ICH claim covering total India QIE, and two separate state claims — one to the MP Film Facilitation Cell for MP-specific expenditure, and one to Rajasthan’s Film Tourism Promotion Division for Rajasthan-specific expenditure. The documentation requirements differ between states and between the central and state tracks. Productions that manage both tracks through a single spend-tracking system from budget draft onwards recover significantly more than those that reconstruct expenditure records post-shoot. Download the State-wise Incentives India reference document for the current qualifying expenditure definitions across all major producing states.
India Cine Hub — Eligibility, Application, and Disbursement
The Incentive Scheme for Shooting of Foreign Films in India, revised and re-notified in 2023-24, provides a payable cash reimbursement of 30% of Qualifying Indian Expenditure, subject to a maximum cap of INR 2 crore (approximately USD 260,000 at current exchange rates). An additional bonus incentive of 5% of QIE is available to productions that employ Indian nationals as 15% or more of their total production manpower, subject to a separate cap of INR 50 lakh. The combined maximum reimbursement available to a foreign production shooting in India under this scheme is INR 2.5 crore. This cap applies per project, not per state. A production that spends INR 20 crore in India receives the same INR 2 crore ceiling as a production that spends INR 8 crore — the ceiling is flat once the 30% calculation reaches the cap.
Eligibility requires that shooting permission for the production was granted by the Ministry of Information and Broadcasting after 1 April 2022. Productions that completed principal photography in India before this date are not eligible under the revised scheme. The production must engage an Indian registered entity — either a local subsidiary, branch, or a formally contracted Indian co-production partner — through which qualifying expenditure is channelled and documented. Incentive claims submitted by the foreign production entity directly, without an Indian co-production partner or registered Indian entity, are not processed.
Official Co-Productions — Enhanced Ceiling at INR 30 Crore
Productions structured as official co-productions between India and one of the 17 countries with which India has signed bilateral Audio-Visual Co-Production Agreements access a materially different incentive ceiling. The Incentive Scheme for Audio Visual Co-Productions, administered through the same India Cine Hub mechanism, provides a cash reimbursement of 30% of Qualifying Indian Expenditure subject to a maximum of INR 30 crore (approximately USD 3.6 million). This is fifteen times the ceiling available to a standard foreign film shoot. Two additional bonus tiers apply: a 5% bonus for Significant Indian Content, and a 5% bonus for employing 15% or more Indian manpower. The combined maximum reimbursement under the co-production scheme is 40% of QIE subject to INR 30 crore.
As of October 2024, India has signed Audio-Visual Co-Production Agreements with 17 countries including Australia, the United Kingdom, Italy, France, Germany, and Colombia. Treaty co-production status means the project qualifies as a national production in both countries simultaneously, enabling it to access domestic financial assistance and public broadcaster commitments in the partner country that are not available to foreign productions. The structure, application process, and compliance requirements for the co-production route are covered in detail under international co-production management.
Application Process and Disbursement
Incentive applications are submitted through India Cine Hub at indiacinehub.gov.in, which operates as the single-window gateway for both the foreign film shoot and co-production incentive tracks. The application requires the production’s MIB shooting permission documentation, a detailed budget with QIE line items clearly segregated from non-qualifying expenditure, a crew list identifying Indian nationals by department, and a production brief. For co-productions, the bilateral co-production agreement signed by the authorised entities in both countries is a mandatory document.
Disbursement operates in two stages. The interim claim can be submitted once a defined proportion of the Indian shoot is complete, allowing productions to recoup a portion of QIE before the project is fully delivered. The final claim is submitted post-completion in India, with the remaining reimbursement disbursed on the recommendation of the Special Incentive Evaluation Committee. The Committee verifies both financial documentation and eligibility conditions — Significant Indian Content and Indian manpower percentage are assessed at this stage. Productions that fail to document manpower percentages accurately across the shoot lose the bonus tier permanently; it cannot be claimed retrospectively. Current application forms and the full guidelines document are published at mib.gov.in. Download the Filming Incentives in India reference guide for a consolidated summary of the ICH scheme and co-production framework.
State Incentive Competition — The 2025 Policy Revision Round
Madhya Pradesh notified the Film Tourism Promotion Policy 2025 on 28 February 2025, establishing the highest per-project incentive ceiling currently active among Indian states for international productions. The policy is administered through the Film Facilitation Cell via MPOnline at filmcell.mponline.gov.in, with single-window permit clearances brought under the Public Services Guarantee Act for statutory timelines. In August 2025, Madhya Pradesh was awarded Most Film Friendly State at the 68th National Film Awards — a recognition that reflects both the policy’s scale and the state’s production infrastructure improvements since 2020. Film producer Ekta Kapoor, speaking at WAVES 2025, cited MP specifically as delivering “everything modern-day film production demands.”
The MP 2025 policy covers a broad range of content types and is structured on production format rather than applying a single flat rate. The minimum shooting threshold is 75% of principal photography within Madhya Pradesh for most formats, and the state’s compact geography — heritage cities, river valleys, temple complexes, and forest reserves within short road distances — reduces logistics costs by an estimated 20–30% against comparable multi-city shoots, which directly increases the proportion of spend that qualifies as in-state expenditure. An additional 10% bonus is available for productions in the regional languages of Madhya Pradesh, including Baghelkhandi, Nimari, Gondi, Bhili, and Korku.
Format-by-Format Cap Structure
The MP 2025 policy sets caps by content format: short films are eligible for up to ₹15 lakh; documentaries up to ₹40 lakh, with a bonus for international distribution; television serials up to ₹1 crore, calculated at 25% of production costs with a minimum 50% MP shoot; web series up to ₹1.5 crore (25% of costs, whichever is lower), with an additional ₹50 lakh available for productions shooting 75% or more in the state; domestic feature films up to ₹2 crore at 25% of eligible in-state costs; and international productions up to ₹10 crore — the flagship ceiling under the 2025 policy. Infrastructure subsidies of 15% are available for post-production facilities established in the state. The ₹10 crore ceiling for international films, combined with the ability to stack this against the central ICH foreign film scheme, positions MP among the most competitive incentive destinations in Asia for large-format international shoots.
Claim documentation requires audited production accounts and verified proof of MP credit inclusion in the finished work. Site permit fees under the MP system run from ₹5,000 to ₹50,000 per location, nominal against the subsidy scale. The full operational guide for MP-based productions is at line producer Madhya Pradesh incentives.
Rajasthan 2025 — 30% Subsidy, INR 3cr Cap
Rajasthan notified its Film Tourism Promotion Policy 2025 in January 2026, replacing the 2022 policy. The scheme offers a production subsidy of up to 30% of eligible in-state expenditure, with the following project-type caps: INR 3 crore for feature films, INR 2 crore for web series, INR 2 crore for documentaries, and INR 1.5 crore for television serials. The minimum qualifying spend threshold is INR 2 crore for feature films and web series, and INR 1 crore for television serials and Rajasthani-language films. The scheme is administered by the Film Tourism Promotion Division under the Department of Tourism, Government of Rajasthan.
The Rajasthan policy also provides fast-track permit approval for productions registered under the incentive scheme — heritage district collectors and ASI monument administrators coordinate permit timelines with the Film Tourism Office, reducing the standard processing window for pre-registered productions. The complete production and incentive handbook for Rajasthan is at Rajasthan film incentives producer handbook, which includes subsidy application steps, ASI clearance timelines, and city-by-city logistics notes.
Uttar Pradesh — 50% Production Rebate
Uttar Pradesh operates one of the most aggressive state-level incentive structures in India. The current UP Film Policy provides rebates of up to 50% of qualifying production expenditure for Hindi and regional language films that shoot substantially within the state. The policy focuses on heritage and religious tourism locations — Varanasi, Ayodhya, Mathura, and Agra feature prominently in the state’s incentive promotion — and offers additional benefits for OTT productions that showcase UP locations in distributed content. The UP scheme also includes stamp duty exemptions for productions that register production companies within the state, and fast-track location clearances through the UP Film Development Council. The 50% rate, the highest flat rebate percentage currently active among major Indian producing states, positions UP competitively for Hindi-language OTT productions with substantial UP-location shoots.
West and South India — State Incentive Structures
Maharashtra administers a 25% production subsidy applicable to feature films and, under revised guidelines, OTT productions distributed on major streaming platforms. The scheme is administered through the Maharashtra Film, Theatre and Cultural Development Corporation (Mahafilm) and provides fast-track permit clearances for productions registered under the incentive programme. Studio-based production in Mumbai qualifies where the studio facility is Maharashtra-registered and the crew is substantially Maharashtra-domiciled. The Maharashtra scheme runs parallel to the central ICH scheme — a production qualifying under both mechanisms can claim the 25% state subsidy on Maharashtra-specific expenditure simultaneously with the 30% central reimbursement on total India QIE.
Maharashtra’s OTT-specific disbursement track is structured around confirmed platform distribution — the subsidy is disbursed post-delivery of the completed series or film to the streaming platform, rather than at the production stage. Productions planning OTT releases should account for this disbursement timeline in their cash-flow projections. The full Maharashtra incentive application structure, cap calculations, and disbursement conditions are at Maharashtra film and OTT incentives.
Karnataka, Tamil Nadu, Kerala, and Telangana — State Incentive Rates
South India operates as a distinct production corridor with four active incentive jurisdictions running simultaneously. Karnataka administers a production subsidy of up to ₹1 crore for films shooting substantially in the state, with Bengaluru serving as the production base for Kannada-language and Kannada co-production projects. Tamil Nadu runs a rebate structure through the Tamil Film Development Corporation, with specific provisions for Tamil Nadu Tourism-approved locations including heritage temples, coastal zones, and the Nilgiris hill stations. The Tamil Nadu scheme has historically been more accessible to regional-language productions than to international shoots, though the state has expanded outreach to OTT platform productions since 2023.
Kerala administers incentives through the Kerala Film Development Corporation, with the state’s tourism-linked location base — backwaters, hill stations, Malabar coastline, and Wayanad forests — qualifying as location assets under the incentive framework. Telangana operates the Telangana Film Tourism Policy with a focus on Hyderabad’s studio infrastructure and the ORR corridor for urban production sequences. The Hyderabad Film City complex on the city’s periphery qualifies for infrastructure-linked incentive provisions under the Telangana scheme. Productions shooting across multiple South Indian states can file separate state claims for each jurisdiction while the central ICH scheme covers the full South India QIE in a single application. Download the South India Film Incentives Guide 2025 for state-by-state scheme details, minimum thresholds, and application contacts. The full South India production incentive framework is at South India film incentives guide 2026.
Stacking Central and State Incentives on a Single Production
A production shooting in Madhya Pradesh as its primary Indian location can simultaneously claim: the central ICH scheme at 30% of total India QIE (up to INR 2 crore for a foreign shoot, INR 30 crore for a treaty co-production), and the MP state scheme at up to 25% of MP-specific qualifying expenditure (up to INR 2 crore for a domestic feature or INR 10 crore for an international production).
On a production with INR 8 crore of qualifying MP expenditure, the combined recoverable incentive can reach INR 2 crore (central cap) plus INR 2 crore (MP state cap for a domestic feature) — INR 4 crore recovered on an INR 8 crore in-state spend, representing an effective 50% return on qualifying expenditure. For an international production structured as a treaty co-production with INR 20 crore of MP spend, the combined ceiling is materially higher and the case for India as a primary location becomes financially decisive against competing territories.
Stacking requires that documentation for each scheme is maintained separately and that QIE segregation is clean — expenditure claimed under the central scheme and expenditure claimed under the state scheme must be reconcilable from the same audited production accounts, with no double-counting of specific line items. The line producer’s cost management system must be structured from the budget draft stage to generate the required reporting format for each scheme’s claiming authority.
GST on Film Production Services — Rates, ITC, and Compliance
GST applies to film production services in India at 18% on the value of taxable supply. This rate applies across the core categories of production expenditure: studio hire, equipment hire, location facility fees from private entities, crew services contracted through registered vendors, catering and transport services engaged for the production, and post-production and visual effects services sourced from GST-registered facilities. Government-owned location fees — payments made directly to government bodies for ASI monument access, national park permits, and public infrastructure access — are generally outside the GST framework and are invoiced as permit fees without GST applied. Private heritage property location fees, where the landowner or trust is GST-registered, attract 18% on the location hire value.
Distribution rights transactions — specifically the supply of film content as a service — are taxed at 12% where the content is supplied on a royalty or rights basis to a broadcaster or OTT platform. Productions that are both producing and distributing content through an Indian registered entity encounter different GST treatment at the production stage (18% on services consumed) and the distribution stage (12% on rights supplied). The distinction matters for ITC planning: input tax credits accumulated at 18% on production services can offset GST liabilities at the distribution stage only where the entity is registered and filing returns for both activities.
Input Tax Credit for Registered Production Entities
Indian-registered production entities that file GST returns can claim Input Tax Credit on GST paid to registered vendors across the production supply chain. For a production spending INR 10 crore on GST-taxable production services at 18%, the ITC pool is INR 1.8 crore — recoverable against GST liabilities on the entity’s taxable output supplies. Foreign production entities without Indian GST registration cannot claim ITC directly; the mechanism applies only through the Indian co-production partner or Indian subsidiary through which qualifying expenditure is routed.
ITC eligibility requires that the vendor invoicing the production is itself GST-registered and has filed the relevant GSTR-1 returns, making the input credit visible in the production entity’s GSTR-2B auto-populated statement. Productions that engage unregistered vendors — a common shortcut in location-specific crew and logistics contracting — lose ITC on those transactions entirely. Vendor qualification is therefore both an incentive compliance issue (QIE documentation) and a GST issue (ITC eligibility) simultaneously. The India Filming Compliance Checklist covering both tracks is available for download: India Filming Compliance Checklist.
Co-Production Treaties and Incentive Practice
Productions structured as official co-productions under one of India’s 17 bilateral Audio-Visual Co-Production Agreements access the INR 30 crore incentive ceiling rather than the INR 2 crore foreign film ceiling — a difference of ₹28 crore on the maximum reimbursement available from the central scheme alone. Treaty status also means the project qualifies as a national production in both countries simultaneously, enabling access to domestic financial assistance programmes, public broadcaster output commitments, and government-backed completion facilities in the partner country that are closed to foreign productions. The bilateral framework additionally removes the foreign content percentage cap that national broadcasters apply to non-treaty productions in most of the 17 partner countries.
Treaty co-production approval must be obtained from the Film Facilitation Office before principal photography begins. Both countries’ authorised bodies — for India, the FFO/ICH under MIB — must confirm co-production status in writing. The script and content requirements that govern treaty co-production approval require genuine creative and financial participation from both countries, not token involvement. Productions that apply for treaty status after the shoot has begun are not approved retrospectively. The full co-production application process, treaty country list, and compliance framework is covered under international co-production management.
Permit and Compliance Integration
Incentive eligibility and permit compliance are interdependent from the pre-production stage. MIB shooting permission is a mandatory document for the ICH application — without it, no incentive claim is processed regardless of spend levels. State-level shooting permissions, ASI monument access approvals, and police and district administration clearances are required for state subsidy applications and, in some states, are assessed as part of the qualifying shoot percentage verification. Productions that treat permits and incentives as separate administrative tracks typically discover the interdependence when preparing the ICH interim or final claim and find that documentation is missing or mismatched. The India filming permissions framework covers the integrated permit and compliance system that supports incentive documentation from location approval through production wrap.
What a Line Producer Manages
Incentive structuring in practice means the line producer builds the QIE tracking system into the budget at draft stage — not as a post-production exercise. Every vendor engaged on the production is classified at the point of contracting as QIE-eligible or non-QIE, GST-registered or unregistered, and Indian or foreign. Every expenditure line in the production budget carries a QIE flag, a GST status, and a state jurisdiction tag. This tagging system generates the ICH application supporting documentation, the state subsidy claim annexures, and the audited accounts the Evaluation Committee reviews — all from the same source data.
Productions that structure their accounts this way recover the full available incentive. Productions that reconstruct expenditure records from raw invoices after the shoot consistently leave money unrealised — either because QIE-eligible transactions cannot be verified from incomplete vendor documentation, or because manpower percentage claims cannot be supported without contemporaneous records. India’s incentive architecture rewards pre-production discipline. The state schemes that make stacking possible — MP’s ₹10 crore international ceiling, Rajasthan’s 30%, UP’s 50%, Maharashtra’s OTT disbursement track, and the South India corridor incentives — are all accessible in combination with the central scheme for productions that enter India with the documentation infrastructure in place from day one.
