Film, TV subsidies are inappropriate


There’s a difference between a tax break and a tax subsidy. It may seem slight — and on the bottom line of businesses, there may be no apparent difference at all. But it’s important nonetheless. It’s all about whose money it is, in the first place.

Here’s what we mean: a tax break lets you keep your money. A tax subsidy takes your money and gives it to someone else.

Those things are only similar if the state assumes your money isn’t yours.

This difference is why the Legislature was completely correct to cut the state’s film and television incentive funds for the coming biennium. We have no objection to giving the film industry some tax breaks; but subsidizing the industry with tax dollars is different.

“In the high-stakes competition for film and television business, Texas has lagged behind such states as Georgia and Louisiana in cash available to lure production to the state,” the AustinAmerican-Statesman reports. “That was before the Texas Legislature gutted the film incentive program in the state budget. The two-year state spending plan that awaits Gov. Greg Abbott’s signature includes $32 million for incentives for film, TV and video game companies — $63 million less than the current two-year budget.”

Various lobbyists warn that might discourage some film and television production in Texas. And that’s true, but it’s beside the point. Hollywood doesn’t need Texas tax dollars. If Georgia and Louisiana, to use the Statesman’s examples, want to use their tax money to lure production, that’s between their legislators and their residents.

An analysis of how Texas has spent its incentive money in years past shows a big discrepancy in who benefits.

As state Rep. Drew Springer, R-Gainesville, notes, “Current biennium numbers show that 69.3 percent of the money spent was in the Austin area, 28.2 percent in Dallas, and 2.4 percent in other parts of the state. Review of previous biennium shows a similar trend — approximately two-thirds of the money is spent in Austin with most of the remaining money spent in Dallas. This is not an economic development fund for the state but rather a local economic development fund supported by the state.”

In other words, the entire state pays into the fund, while Austin and to a lesser degree Dallas, reap the rewards.

That’s not to say the impact of film, television and more recently video games on the state isn’t important. But that doesn’t mean it needs to be taxpayer supported.

Film and television subsidies can also put taxpayers in awkward positions, forcing them to fund things they might find objectionable. It’s one thing to spend $932,133 on the historical film “Parkland,” but do taxpayers really want to spend $436,391 for “Killer Women”?

A better way to lure film and television production is through tax breaks, instead of direct subsidies. Texas already has plenty of reasons for producers to prefer it; we’re a right-to-work state and we have a talented and well-educated workforce.

Film and television production isn’t a valid reason to take your money to give to Hollywood.

http://www.tylerpaper.com/TP-Editorials/220536/film-tv-subsidies-are-inappropriate

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