by Lauren Keiper
Boston Business Journal
January 15, 2010
Tax credits and other incentives that states use to lure filmmakers are not producing the expected economic benefits, according to a new report from the Tax Foundation — a claim that experts in the Bay State say has nothing to do with film production in Massachusetts.
In its report, the Tax Foundation, a tax watchdog group, points to economic woes and unreasonably high credits threatening the future of movie production incentive programs in Louisiana and Michigan. The group also says that upfront research on economic benefits of introducing tax credits is often exaggerated.
Officials in Massachusetts noted that Massachusetts is omitted from specific criticism in the report. “The credit is working here much better than anyone thought it would,” said Nick Paleologos, executive director of the Massachusetts Film Office. He calls Massachusetts’ 25 percent credit a “moderate, middle-of-the-road credit being offered in a state where this industry can really profit.”
Paleologos points to Mass. Department of Revenue figures from July 2009 to substantiate his claims. According to the DOR report, between 2006 and 2009, direct new spending in the state as a result of movie production topped an estimated $1 billion and led to more than 3,000 new direct and indirect jobs.
But it’s more than just tax incentives that attract the Hollywood set. Mary Fifield, spokeswoman for the Massachusetts Production Coalition, says it’s also the state’s natural beauty, historic sites, work force and infrastructure that keep filmmakers coming back.