Newly Proposed Theater Tax Credit All-Too Familiar
As Pioneer reported earlier this summer, there have been questions surrounding the viability of incentives provided by the Massachusetts film tax credit since its inception in 2006. It was adopted to attract motion picture production companies by offering them generous tax breaks for filming on location around the state. In exchange, the companies are expected to create industry jobs for Massachusetts residents, and spur local investment and growth. While there has certainly been a recent uptick in big-budget film productions, much of the revenue produced is going out of state, and taxpayers are not seeing a reasonable return on their dollars.
A recent Boston Globe editorial also echoed the pitfalls of the film credit, supporting the conclusion that it has been a poor investment. Unfortunately, since annual spending on the credit is uncapped, spending may continue to increase, as film companies seek to access the favorable incentives.
Now the House has approved a similar credit for theater productions as part of a broader economic development bill that also cites general claims about job creation and stimulus for Boston as a cultural center and destination as its benefits. While this bill does cap spending at $5 million, it is disheartening that our representatives have not learned their lessons from the failure of the film tax credit.
As the Globe points out, this proposal comes in the midst of declining revenue estimates that have necessitated large spending cuts; hardly the time to introduce frivolous new spending on tax breaks. Luckily, the bill faces strong opposition in the Senate, and even it if were to be passed, it would likely be vetoed by Governor Baker, who has spoken out against the film incentives. Let’s hope our legislators don’t get stage fright and pass this ill-advised bill.