Wednesday, January 09, 2013
Tax Breaks for Hollywood Hypocrites
Hollywood has long been a goldmine for big-government Democrats who inveigh against wealthy folks who aren’t paying “their fair share” in taxes.
Thus, it seems fitting that the first annual “Al Gore Height of Hypocrisy Award” should go to those Tinseltowners who last year received a two-year extension of California’s Film and Television Tax Credit program. (Gore, by the way, recently sold his Current TV cable channel for a bundle to a news outfit funded by the oil-rich Emir of Qatar.)
The aforementioned Sacramento stocking stuffer provides 100 million dollars in tax credits to lucky California productions randomly selected from the hundreds of applications submitted to the California Film Commission. The lottery continues until all the year’s goodies have been allocated.
This giveaway provides a 20 percent tax credit for feature films with production budgets between one and seventy-five million dollars. Made-for-television and mini-series productions with budgets of at least $500,000 also qualify—as do new television series licensed for original distribution on basic cable.
According to a study by the self-interested Los Angeles County Economic Development Corporation, this modest program (by government’s lax standards) generated more than $3.8 billion dollars in economic activity in California and “supported” more than 20,000 jobs during its first two years of operation.
A more somber portrait was offered by the non-partisan Legislative Analyst’s Office. It concluded that the policy “appears to result in a net decline in state revenues”—an odd outcome for a program that, if the law’s L.A.-based authors are to be believed, would end the state’s economic woes if only it were dramatically increased.
This special deal for TV and film productions is needed, it should be noted, because folks in that industry have been fleeing California to sites where tax burdens are less onerous and various tax breaks are available.
According to one estimate, “the number of studio-backed feature films shot in California dropped from 66 percent in 2003 to less than 40 percent last year.” Other reports spotlight a dramatic decline in TV productions. Tax incentives offered by various states and Canada were cited as a major reason for the drop.
Riverside County Supervisors Jeff Stone and John Benoit are hoping to cash in on this exodus by offering Hollywood hypocrites financial incentives that are closer to home.
Here’s a thought: If tax incentives work for Hollywood liberals, why not employ the general principle throughout the economy and abolish special perks for political cronies—like the estimated $430 million slice of filmmaker pork that was stuffed into the recent fiscal cliff deal in Washington D.C?