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1 Jared Walczak, Testimony on Film Tax Incentives before the Florida Senate Appropriations Committee on S.B. 1214, April 21, 2014 1 (2015)

handle is hein.taxfoundation/tefiltxinc0001 and id is 1 raw text is: TAX FOUNDATION Apr. 2015 The Tax Foundation is a 501(c)(3) non-partisan, non-profit research institution founded in 1937 to educate the public on tax policy. Based in Washington, D.C., our economic and policy analysis is guided by the principles of sound tax policy: simplicity, neutrality, transparency, and stability. @2015 Tax Foundation Distributed under Creative Commons CC-BY-NC 4.0 Editor, Melodie Bowler Designer, Dan Carvajal Tax Foundation 1325 G Street, NW, Suite 950 Washington, DC 20005 202.464.6200 taxfoundation.org Testimony on Film Tax Incentives before the Florida Senate Appropriations Committee on S.B. 1214 April 21, 2014 .............................................................................................................. By Jared Walczak Policy Analyst Testimony as Prepared Chairman Lee and members of the committee, as you contemplate the extension of film tax incentives and the creation of a quick action closing fund to authorize up-front incentives to the industry in advance of any job creation, I'd like to offer three observations: * film incentives don't promote economic growth; * film incentives don't come close to paying for themselves; and consequently, * film incentives divert money away from far more worthy projects. While industry-backed studies and economic development offices, including Florida's, often report significant return on investment and induced employment figures, state revenue offices are increasingly scrutinizing film incentives, and their findings are consistently negative. The Massachusetts Department of Revenue found that the state spent more on credits than the industry actually spent in the state, that Massachusetts recouped only 11 cents on the dollar in tax revenue, and that the average new job cost the state nearly $119,000 in tax credits. Maryland's best case scenario was recouping 6 cents on the dollar. For Connecticut it was 7 cents. Michigan's Senate Fiscal Agency found a taxpayer cost of $193,000 per direct hire. California, Louisiana, New Mexico, Pennsylvania: the best any of these states could come up with is only losing three-quarters of its so-called investment. I'm aware that the Florida Office of Film & Entertainment shows much different figures-remarkably different. We're told that over a decade, film incentives and the sales tax credit created 675,000 jobs, nearly 118,000 of them in 2013 alone.

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