Film tax credits exist in most U.S. states for the same reason business tax credits exist: to lure commerce within state lines. But -- surprise, surprise -- like many government subsidies, they're often wasteful money chasing after projects that would have happened anyway. The Center on Budget and Policy Priorities investigates:
Film tax credits have become one of the most widespread ways that states subsidize private industry. Forty-three states offer tax subsidies to producers that shoot films within their borders. Most of these subsidies take the form of credits against business taxes, especially taxes on corporate profits.
In the 2010 state fiscal year, states spent about $1.5 billion on film tax subsidies. In 2009, that money would have paid for the salaries of 23,500 middle school teachers, 26,600 firefighters, and 22,800 police patrol officers. In some states, such as Connecticut, Louisiana, Massachusetts, Michigan, North Carolina, and Rhode Island, the value of film subsidies appropriated or awarded annually exceeds that of longstanding business tax incentives, such as tax credits for investment and research and development.
Read the full story at CBPP.
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