Inversions have been in the news consistently this summer as multiple companies have looked for legal paths away from the U.S. corporate tax system. Burger King became the latest corporation to add to the list after they...
- The Tax Policy Blog
- More on Iowa Film Credits and Why Tax Reform is So Diffic...
More on Iowa Film Credits and Why Tax Reform is So Difficult
Bill Ahern blogged earlier on a bill introduced in the Iowa General Assembly last week would eliminate the state's $50 million film tax credit program. As Bill notes, the tax credit for movie productions has become a poster child for tax subsidy corruption and abuse. Corruption and abuse aside, film tax credits are a bad use of tax policy. See why here.
The day after the bill was introduced representatives from various film industry organizations showed up at a House Economic Growth Committee hearing to beg lawmakers not to repeal their special tax break. This provides a lesson that helps answer the question of why many tax expenditures are so hard to get rid of. The benefits are concentrated within a relatively small pool of individuals or businesses, in this case mostly the filmmakers, that will fight tooth and nail to keep their carve-outs, while the costs are dispersed among the rest of the taxpayers who individually are not likely to have a large incentive to fight the special interests. Hopefully Iowa's lawmakers have the rest of the taxpayers in mind and will repeal the film tax credit.
Subscribe to the Tax Foundation Newsletter
Join the Tax Foundation's fight for sound tax policy Go
About the Tax Policy Blog
The Tax Policy Blog is the official weblog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.