North Carolina looks to scale back on their film tax credits; Hollywood doth protest

Last February, Glenn Reynolds wrote a great piece on the many elitist Hollywood liberals that are all too content to deride the insatiably and ignobly greedy tactics of other, more pedestrian industries and lecture on the need for everyone to contribute their “fair share” in taxes to the good of society, and yet are simultaneously very glad to seek out the highly generous tax breaks that the move industry receive from states across the country to incentivize Hollywood productions to set up shop there.

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The WSJ reports that the sorts of state subsides and incentives to which Reynolds referred have recently been declining somewhat as states shift their post-recession priorities to more pressing fiscal matters, and that North Carolina is a heartbeat away from winding down one of its most extensive programs for awarding tax breaks to film companies — much to film interests’ chagrin.

The Motion Picture Association of America says the quality of the state’s studios and film crews rival those found in Hollywood and New York City. The state trails only California, New York, Georgia and Louisiana in production revenue, according to the N.C. Film Office.

But the budget for the next two fiscal years approved in July by the state legislature lets the incentive program sunset on Jan. 1, 2015. …

“We spent $70 million on film incentives last year, and what else could we have done with that $70 million?” said Rep. Mike Hager, the GOP majority whip, who hails from Rutherford County, where “Dirty Dancing” was shot. “We could have paid more teachers, kept our teacher assistants, given raises to our highway patrol.” …

Most states pay a subsidy worth about 25 cents for every dollar of production expense, return on investment is hard to quantify, and the highest-paying jobs go to people out of state, says the left-leaning Center on Budget and Policy Priorities in Washington.

The Motion Picture Association of America says film incentives have a multiplier effect, citing a recently commissioned study that shows North Carolina’s $20 million in incentives last year for “Iron Man 3” led to $180 million in local spending, or nearly $9 for each $1 invested.

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Questionable, and the overarching point is that the big names of Hollywood are so often all too happy to consider themselves a cut above the oh-so-disdainful operations of other perfectly rational, profit-seeking businesses in other industries while reaping the benefits of special government treatment at average taxpayers’ expense.

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