In a recent article, the Associated Press has reported that a tax reform panel created by Gov.Andrew Cuomo recommended that the state scale back its tax breaks for the film industry. The panel claimed that the measure wasn’t creating enough jobs to be worth the cost to taxpayers. According to the AP, the panel cited studies that questioned whether the tax breaks are a “net help to the economy” or whether they even create enough jobs to make up for the lost revenue,
However the report, written for the New York State Tax Reform and Fairness Commission, was not part of that panel’s final published series of recommendations.
The panel’s thinking, whether finally proposed or not, directly challenges the Governor’s own concerns. One bill in the Governor’s third budget – passed earlier this year – included an extension of the state’s film and postproduction tax credit program through 2019. Labor and industry groups including the Post New York Alliance had worked with the state legislature in crafting the jobs promotion aspects of the measure.
With Gov. Cuomo’s enthusiastic support of the film production tax abatement measure helping to push it through the legislature, it’s striking that a panel he assigned chose to directly disagree with his budget proposal. However, one of the 11-member commissions other proposals – to eliminate the state’s popular sales tax exemption on shoes and clothing priced under $110 – is a similar and regular refrain of business concerns which are uncomfortable with such direct economic support..
Here’s the beginning of the article in the New York Business Journal. You can read the full article here.
.A tax reform panel created by Gov.Andrew Cuomo is recommending that the state scale back tax breaks for the film industry, saying the measure doesn’t create enough jobs to be worth the cost.
The report, prepared for the New York State Tax Reform and Fairness Commission but not published, found that if the state ended its tax breaks for certain companies and industries such as film productions, New Yorkers could save $2 billion, according to the Associated Press.
The state’s film production tax credit program provides qualifying film and television productions a 30 percent credit for qualified production expenditures. In August 2010, new legislation extended the program through 2014, allocating $420 million per year…
