Film tax credits would reallocate Missouri’s tax dollars to a handful of companies in the film industry. This credit is not a new concept in our state. We’ve tried it before and it failed.
In 2010, the Tax Credit Commission recommended Missouri General Assembly discontinue the credit, stating, “This tax credit serves too narrow of an industry and fails to provide a positive return on investment to the state. There is currently no long-term opportunity for the location of production facilities for films in Missouri.”
The last time Missouri attempted Film Tax Credits, we lost employees in the film industry – 4,143 in 1997 to 3,949 in 2009.
We often hear about Georgia and how they filmed a show about Missouri there rather than here. But Georgia’s numbers are often exaggerated, and Georgia’s auditors stated so both in 2020 and more recently in 2022, especially regarding the number of jobs created and the impact on the economy. Their audit notes that the Georgia Department of Economic Development used an inflated multiplier to estimate spending in the state, misrepresented the distribution of jobs resulting from production-related expenditures, and that department attributed wages unrelated to credit spending.
Georgia paid $6.5 billion in film tax credits from 2011 to 2021 but, according to the Bureau of Labor Statistics, shows an increase of only 15,611 jobs, costing Georgia taxpayers over $400,000 per job created.
The recent analysis by the Department of Audits and Accounts found that 88 percent of film tax credits went to non-Georgia companies, and 53 percent of all labor income in the film industry went to nonresident workers.
Film production in Georgia may exceed that of most other states, but it still only makes up 1/200th of Georgia’s $600 billion economy. And yet, Georgia taxpayers spend over $1 billion each year on film tax credits (up from $141 million in 2010), which is more than the State of Georgia spends on all but six state departments.
There is plenty of evidence that film tax credits do not create the expected impact supporters share.
The question legislators should ask themselves is, is there a better use of these funds? Should we use these funds to maintain our infrastructure, advance education, increase public safety, or reduce the number of funds Missouri takes from taxpayers?
Yes, we believe there is. We advise the legislature to oppose film tax credits and instead phase out the corporate income tax, reducing the tax burden of all Missouri corporations, or further lower the personal income tax to help all Missouri taxpayers and small businesses. Let’s not pick winners and losers and instead focus on making Missouri a great state to do business in, regardless of industry.
Photo by De’Andre Bush on Unsplash