Monday, February 27, 2012

Most states provide tax breaks to make movies, but most of them won't say who got how much

George Clooney and Shailene Woodley in The Descendants
Almost 40 states offer some form of tax credit, rebate or other incentive to film and TV producers to create jobs, often in rural areas, but few state film offices will reveal exactly how much they give, Will Wilson reports for Stateline.

Of the nine films nominated for best picture at last night's Academy Awards, five got tax breaks. The Descendants, filmed in Hawaii, caused Gov. Neil Abercrombie to ask that the state's temporary tax credit become permanent, but the tax credit program's director won't reveal the exact amount of subsidy the film got. In Texas, where The Tree of Life was filmed, the head of the state's film commission gave the exact amount: $434,252.79.

State film commissions often reveal aggregate numbers that show total tax breaks in a year, Wilson reports, and it's not hard to find out if a production got help from a state. But only one-third of states that offer incentives reveal how much they give individual productions, according to Good Jobs First, a watchdog group that keeps track of state economic-development subsidies. Many in the film industry view the information as a trade secret, fearing competitors can "do a back-of-the-envelope calculation to figure out key details about the studio's cost structure." They say if states reveal incentive figures, productions will likely move to states that won't.

Massachusetts state Sen. Ben Downing pressed for disclosure of the identity of those receiving the tax credits and the amount each got. He said states "need to know exactly what they're getting for their money" and compare that with other economic development programs. Recent scandals have shown these credits can be abused; film producers and the head of Iowa's film office were found to be misusing funds, and director Daniel Adams was indicted in December for allegedly inflating expenses to receive more tax breaks in Massachusetts. (Read more)

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