Hollywood East? Film Tax Credits in New England

Abstract

New England's villages and seacoast, its character and characters, attract producers of movies, television shows, commercials, and other film and video projects. But such work is not just about lovely scenery-it is also about business. Because production costs help determine where such projects are made, five of the six New England states now provide tax credits or other financial incentives to attract producers to film on location. This policy brief discusses whether these incentives attract more production, and whether they are costeffective in creating jobs. It focuses on the use of one major incentive: film tax credits. The little evidence available suggests that film tax credits do attract film production and create jobs in states that have little or no film industry. However, they also cost states considerable foregone tax revenue. The film production stimulates little additional economic activity in other industries. Consequently, film tax credits do not "pay for themselves" by indirectly generating additional corporate income, sales, and property tax revenues. Evidence on the benefits of film tax credits to states with a large film industry already in place, such as New York, is too scant to enable analysts to draw firm conclusion. As more evidence becomes available, policy analysts and policymakers should evaluate the cost-effectiveness of film tax credits relative to alternative policies designed to promote job creation and economic growth. They should also take into account the economic effects of measures needed to offset the revenue losses incurred by film tax credits in order to maintain balanced budgets.

Screen production on the ‘biggest set in the world’: Northern Ireland Screen and the case of Game of Thrones

“…In North America, tax credits have long served as an incentive for companies to base their operations in a particular location (Christopherson and Rightor, 2010; Coles, 2010; Mayer, 2017). The use of tax credits in this way has received criticism from those who view them as little more than ‘welfare for the wealthy’ (Guback as quoted in Mayer and Goldman, 2010), or from those who question whether or not they constitute anything more than ‘tax windfalls’ (Rollins Saas, 2006: 1). Tax credits have been termed ‘generous’ with Tannenwald (2010) taking the view that in 2010, subsidies of US$1.5 billion across a range of US states was ‘money that they otherwise could have spent on public services like education, health care, public safety, and infrastructure’ (p. 1).…”