A $40M DISNEY production is the first of several big budget films being lured to Ireland following the introduction of enhanced tax breaks.

The movie will be one of the first to benefit from an increase in the cap on the level of tax-free investment that can be raised per film — from €10.5m to €15m.

Irish film-makers hope that the higher tax breaks will help revive the industry after a sluggish year. The republic has been losing productions to cheaper locations such as Eastern Europe, where the cost of shooting is lower. The higher ceiling, which will take effect from January 1, will make shooting in Ireland more attractive.

The Banshee is a period ghost story. It tells the tale of a little boy who is ignored by the world and pretends to be a ghost, before coming into contact with a real spirit. The banshee, according to Irish folklore, was a long-haired female spirit who foretold people’s deaths by wailing.

Disney said the film, which is due to begin filming next April, “will appeal to a Harry Potter audience”. The supernatural mystery is described as a “story of friendship, love and loss”. The film was written by Dean DeBlois, best-known for the Disney animated film Lilo & Stitch, who will also direct.

Another major Hollywood studio is bringing a $25m project to Ireland, which is due to begin filming in March. A “very significant” Spanish production is also due to shoot in the country.

Naoise Barry, Ireland’s film commissioner, said that the improved tax breaks were “definitely” having an effect on next year’s production levels. “The reason The Banshee is coming here is in part because of what Disney has been asking for — an increase in the cap. My discussions with the studios and the enquiries we have been getting from the US, continental Europe and the UK, makes clear that the raising of the cap is playing a significant role.”

“The first half of next year is beginning to look better already,” said James Flynn, a producer who has been involved in bringing several films to Ireland. “(Raising the cap) is very, very helpful.”

Later this week, John O’Donoghue, the arts minister, will launch an initiative designed to make Dublin an easier place in which to make movies. On Thursday, the Irish Film Board will announce details of Film Dublin, a joint initiative with the gardai and Dublin city council to aid film-makers shooting on the capital’s streets.

Next Sunday, the first movie to benefit from the New York-style film office will shoot scenes on Dublin’s main thoroughfare, with the help of gardai. Filming of The Honeymooners, a $30m movie for Paramount Pictures, will take place on O’Connell Street until noon. Ireland is doubling for New York in the film, a remake of a 1950s American sitcom.

The scene will feature a New York single decker bus being driven up and down O’Connell Street, which is supposed to be a street in downtown Manhattan. However, because it has to drive on the other side of the road to look authentically American, garda outriders will be required to keep traffic at bay. The bus, and other American cars, have been brought over from Britain for the film.

The shots will be tight so Irish landmarks like the Spire and the GPO do not appear in the scenes. “It will genuinely give a feel of a New York street in Manhattan,” said Barry.

The film is the first to get a new level of support and co-ordination from Dublin city council and the police, through the new film liaison office.

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