A common misconception about the film tax credit (which appeared most recently in a
BBJ editorial) — that film companies are getting a “free ride on taxes” — is completely
false.
Before a single tax credit can be lawfully issued in Massachusetts, companies must not
only spend their money in our state, but also pay state taxes. These include income
taxes, meals taxes, gas taxes, and hotel taxes—just to name a few. These same film
companies also pay local taxes and fees.
For example, Adam Sandler’s company is currently shooting a pair of movies in
Massachusetts. The first film made a payment of $150,000 to the Town of Essex. The
second, contributed more than a quarter million dollars to the financially strapped
Franklin Park Zoo. They are just two of the films shooting here this year. We’ve had
more than two dozen major films paying taxes and fees in Massachusetts since 2006.
And even though many of the stars of those movies live out of state, they are required
to pay income taxes to Massachusetts—not only on their big salaries, but also on all
residual income they’ll receive for many years to come!
For evidence of the success of the program, one need only look to the most recent
report from the Massachusetts Department of Revenue. DOR calculated economic
output generated by the film tax credit to be $870 million over just the first three
years. And the cost to taxpayers for all that economic activity–as of the end of FY
2008? Zero. That’s right. During the first 3 years of the program (according to DOR),
the state actually collected $3.6 million dollars more in taxes than we paid out in
redeemed credits. Now that’s real economic stimulus!
BBJ editorial) — that film companies are getting a “free ride on taxes” — is completely
false.
Before a single tax credit can be lawfully issued in Massachusetts, companies must not
only spend their money in our state, but also pay state taxes. These include income
taxes, meals taxes, gas taxes, and hotel taxes—just to name a few. These same film
companies also pay local taxes and fees.
For example, Adam Sandler’s company is currently shooting a pair of movies in
Massachusetts. The first film made a payment of $150,000 to the Town of Essex. The
second, contributed more than a quarter million dollars to the financially strapped
Franklin Park Zoo. They are just two of the films shooting here this year. We’ve had
more than two dozen major films paying taxes and fees in Massachusetts since 2006.
And even though many of the stars of those movies live out of state, they are required
to pay income taxes to Massachusetts—not only on their big salaries, but also on all
residual income they’ll receive for many years to come!
For evidence of the success of the program, one need only look to the most recent
report from the Massachusetts Department of Revenue. DOR calculated economic
output generated by the film tax credit to be $870 million over just the first three
years. And the cost to taxpayers for all that economic activity–as of the end of FY
2008? Zero. That’s right. During the first 3 years of the program (according to DOR),
the state actually collected $3.6 million dollars more in taxes than we paid out in
redeemed credits. Now that’s real economic stimulus!
 |  |  |
Film tax credit means business
By Rep. John Keenan and Rep. Charles Murphy
By Rep. John Keenan and Rep. Charles Murphy
Send comments to editor@deltafilms.net
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