National Taxpayers Union (NTU) applauds Michigan Governor Rick Snyder, who recently signed a law ending state incentives for the film industry. House Bill 4122 ends Michigan’s ill-conceived film incentive program ostensibly designed to grow the state’s movie industry. The bill will wind down the Michigan Film Office over the next three years.
The program began in 2008 and has paid out more than $250 million in incentives since inception. Spending hundreds of millions of dollars on making movies is a steep price, especially when there have been few full-time industry jobs created. The new legislation shifts $50 million in film subsidies to road repairs.
Our friends at the Tax Foundation prepared a summary of the problems with the film incentive program. First, this program provides primarily temporary jobs. The reality of the production business is that it does not provide long-lasting, full-time jobs. These short-term jobs end when production ceases. Second, the program does not generate revenue from increased economic activity.
NTU commends Michigan for taking a step in the right direction. Taxpayers are better served by broad-based marginal rate reductions, rather than tax incentive gimmicks.