The Cost of a Movie

Roll it!Grand Rapids blog Local Area Watch recently posted a story on how Michigan’s taxpayers are investing in filmmaking.  We have already posted state Representative Chuck Moss’ opinion of the film industry tax break some of Lansing’s lawmakers passed just a few months ago.  The new laws have been decried by both parties, and rightly so.  It appears that Michigan taxpayers will end up shelling out more than $125M in the next year in tax-credit subsidies to try and attract filmmakers to Michigan.  That is not a good idea.

Bringing filmmakers to Michigan would be great.  In fact, it sounds like a fantastic idea.  The automotive industry is idling along right now, and some of Michigan’s most popular tourist destinations are in a state of emergency.  It is a bad idea, though, to grant special favors, at the expense of Michigan’s taxpayers, which will end up costing over $125M while only generating $10M of income.  That simply is not good business.  What sounds like a much better idea is canning both the new Michigan Business Tax and the filmmaker tax credits.  Then, Michigan’s Legislature could replace them both with a simple tax on businesses that treated all firms in the same industry as equals.  Perhaps then, taxpayers could stop paying studios to come to Michigan, and those same taxpayers could benefit from the broader taxbase provided by the 22 major film projects currently in Michigan.  Subsidies are only a short-term, and often ineffective fix, and far better planning will be required to attract and keep new industries here in Michigan.

Thanks to Michigan Messenger for tipping me off to this story.

<>< Josh Rule : : 2008 MCPP Intern


3 thoughts on “The Cost of a Movie

  1. “Bringing filmmakers to Michigan would be great. In fact, it sounds like a fantastic idea.”

    Why is it the state’s job to attract and retain industries in its borders?

  2. Hopefully, it was clear that I do not think it is the state’s job to attract and retain industries. Quite the opposite, in fact. It is anyone but the state’s job to deliberately seek out particular industries. All the state should do is create a clear tax structure for businesses that makes it profitable to operate in Michigan. New industry in Michigan, however, would be great. Again, I am not arguing that the state should do it, just that it would be great if a new industry or two decided that Michigan was worth the investment.

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