This week’s Economist magazine reviews a proposal in California to boost their film and television tax credit. The report notes that it’s getting tougher to compete with Louisiana’s 30 percent refundable credit or New York’s $420 million annual budget to subsidize film and TV, and that independent analyses find these do little on net for job creation or economic growth.
One of their sources is yours truly:
The other answer is that handouts for moguls are not as popular as they once were. Several states have capped or scrapped their programmes; Joseph Henchman at the TaxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. Foundation, a think-tank, reckons they peaked in 2010. Michigan’s scheme, which some thought—absurdly—could make up for job losses in the car industry, was scaled back under a Republican governor. Despite hosting “Iron Man 3”, one of last year’s smashes, many in North Carolina want to let their state’s scheme wither. “At some point you accept that Louisiana is determined to pour its treasure into Hollywood’s pockets,” says Mr Henchman, “and you let them do it.”
Check out the full article here.
See also our Background Study on film tax incentives, our 2011 Update on the status of state film tax creditA tax credit is a provision that reduces a taxpayer’s final tax bill, dollar-for-dollar. A tax credit differs from deductions and exemptions, which reduce taxable income, rather than the taxpayer’s tax bill directly. programs, and our rebuttal of the MPAA’s criticism of our work.
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