I recently attended a lecture given by Arnold Kling, who is a former Federal Reserve economist on the Board of Governors staff, former senior economist at Freddie Mac, and all-around financial and monetary expert. The...
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- Washington Revives Film Tax Incentives Program
Washington Revives Film Tax Incentives Program
Despite a recent nation-wide trend away from film tax credits, Washington Governor Christine Gregoire (D) has signed a bill that will reinstate the state's incentive program, which expired in 2011. According to Tax Analysts (subscription required), SB5539 was signed on March 29th after proponents argued that Washington's film industry is being threatened by those of Oregon and British Columbia.
The Washington state program allows filmmakers to receive rebates that are worth up to 30 percent of their business and occupation tax burdens within the state. The recently signed bill expands the definition of "motion picture" to include productions intended for viewing on any technological platform, meaning that shows and commercials targeted towards internet-based audiences will be able to receive the incentives as well. The program is capped at $3.5 million in tax relief per year.
State Senator Jeanne Kohl-Welles (D-Seattle), the bill's main sponsor, cites the "Twilight" movies as an example of the necessity of the tax credits. The films were set in Forks, WA but were filmed in Oregon. Said Senator Kohl-Welles: "We have tourists from all over the world going to the town of Forks because it was the setting of the hit vampire movie series, 'Twilight.' That's great, but imagine the economic impact the region would have seen if the movies had actually been filmed in Forks, with locally-hired crew members and all food and lodging expenses going straight into the local economy."
Opponents have criticized the measures during a time when the state is considering cuts on education spending.
It is interesting that Washington has chosen to continue with movie production incentives as other states have begun to abandon such programs. They have proven to not be cost-effective and legislators have realized that the forgone revenue would be better used elsewhere. Recently, the Tax Foundation submitted testimony to the Finance Committee of the House of Representatives of Alaska regarding a similar program in that state.
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