The Massachusetts film tax credit program has been a flop, a taxpayer rip-off that enriches one of the nation’s most profitable industries while choking off funds from more pressing public needs. Naturally, some legislators are now eager for a sequel.
The Bay State has been lavishing corporate welfare on movie producers and Hollywood actors since 2006. It gives production companies a 25 percent tax credit on anything they spend to make a film or TV show in Massachusetts — credits they can sell for cash to third parties. Like most schemes that use public funds to bribe industries into doing business in Massachusetts, the film tax credit program has been a loss-maker from the outset. The Department of Revenue’s most recent annual report on the program noted that while filmmakers in 2010 collected $14.6 million in tax credits, their productions generated only $800,000 in new state revenue. That amounted to a paltry 5 cents of tax revenue for every $1 in tax credits the commonwealth gave away. (In 2009, Massachusetts awarded credits worth $83.3 million, but reaped only $10.4 million in revenue —12 cents of tax revenue for every $1 in subsidies.)