Louisiana Budget Project's latest report on the state's film tax credit program says the state pays $60,000 for each direct job created in the film industry. Louisiana is behind only California and New York for film production thanks to the state's film tax credit initiative, but at what cost to taxpayers?
According to a report from the Louisiana Budget Project, the state spent $231 million on subsidies for the film industry last year, up 29 percent from the year before. The tax credit initiative has cost more than $1 billion over the past 10 years, the report states, making it one of the most expensive film tax credit programs in the country.
"People are getting rich on this deal, and it isn't Louisiana taxpayers," Jan Moller, director of the Louisiana Budget Project, says in a press release. "Louisiana needs to limit the cost to taxpayers without pulling the rug out from under the industry."
The report calculates a $60,000 subsidy for each direct job created in the film industry:
The report recommends that Louisiana follow the lead of several other states that have recently capped their film credit programs or limited the amount of money appropriated. If Louisiana follows suit, it will provide fiscal constraints and greater certainty in the annual budgeting process, all while increasing transparency.
"Rather than eliminating the subsidies, legislators should phase down the amount of the tax credit over a number of years to give the film industry time to stand on its own with less public support," Moller said.
Louisiana Budget Project is a Baton-Rouge based nonprofit that analyzes government budgetary effects on low-income residents.
Read the full report here.