More on Pennsylvania Film Tax Credit

June 5, 2009

Regarding our post yesterday about a study on Pennsylvania’s film tax credit, Philip Durgin of the Legislative Budget and Finance Committee writes:

Just to set the record straight, nowhere in our report is there a claim that the tax credit “pays for itself”, and it’s not fair to attribute such a statement to our report. That was something a local reporter came up with on his own.

I’m happy to make that clarification. However, to the extent that the study claims that film-related economic activity induced by the tax credits in Pennsylvania equals or exceeds the cost of the credits, I’d say that’s a claim that it “pays for itself” even if the term itself was not used.

As I mentioned in the post, the study used a couple different ways to calculate benefits from the tax credits. But the big missing component is that of opportunity costs—what unseen things that Pennsylvania has lost because they have film tax credits. I do regret, however, not applauding Pennsylvania for one thing: for having their credit expire and be subject to rigorous review and study before renewal. I wish all states did that.


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