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Position | TRENDS AND TRANSITIONS - Motion picture incentives |
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In the last decade, tax incentives for film and entertainment productions have spread across the country. State officials have used the programs to lure filmmakers to their states for many reasons, including job creation and tourism promotion. Currently, 45 states and Puerto Rico offer motion picture incentives. These incentives include tax credits, rebates and exemptions.
Critics and advocates, however, disagree on their effectiveness on stimulating the economy, creating jobs and luring tourists.
Tax credits in Michigan seem to have spurred business in that state, hard hit by layoffs and plant closings. In 2007, before Michigan offered a tax credit for production costs, two films were made there. In 2008, after enacting the credit, 35 producers chose to film in Michigan, and by mid-2009, 85 movies already were made or had applied to within the state. In 2007, movie makers spent $2 million in Michigan; in 2008, that number was up to $125 million, according to USA Today.
Other states are touting the impact of the film industry on their economies as well. In Louisiana, lawmakers in 2009 increased the 25 percent film tax credit to 30 percent and eliminated...
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