![]() ![]() Tax Credits: Tax credits can remove a portion of the income tax owed to the state by the production company, but since most production companies are limited purpose business entities they often incur very little, if any tax liability.Movie Production Incentives (MPIs): "Movie Production Incentive" is any incentive states offer filmmakers to encourage film production in-state. ![]() In 2013, Los Angeles mayor Eric Garcetti appointed former Motion Picture Academy president Tom Sherak as the city's first "film czar" to advocate the state on behalf of the city for more favorable movie production incentives, an office then held by entertainment attorney Ken Ziffren. Critics have suggested that the increase in states offering incentives mirrors a race to the bottom or an arms race because states continue to increase the scope of their incentive packages to compete on a national level to not only maximize their individual benefits but also to stay ahead of their competitors. The perceived success of Louisiana's incentive program did not go unnoticed by other states, and by 2009 the number of states which offered incentives was 44, up from 5 in 2002. Over the next three years Louisiana experienced an increase in film and television productions some of which were nominated for Emmy Awards. Louisiana was the first state to do so in 2001, and in 2002 passed legislation to further increase the scope its incentives. states saw the opportunity to launch their own production incentives as an effort to capture some of the perceived economic benefits of film and TV production. Studies show that tax incentives for movie and television productions have low overall economic effects, with low rates of return for states that offer the incentives. ![]() Others argue that the cost of the incentives outweighs the benefits and say that the money goes primarily to out-of-state talent rather than in-state cast and crew members. Proponents of these programs point to increased economic activity and job creation as justification for the credits. Many include tax credits and exemptions, and other incentive packages include cash grants, fee-free locations, or other perks. The structure, type, and size of the incentives vary from state to state. Since the 1990s, states have offered increasingly competitive incentives to lure productions away from other states. Movie production incentives are tax incentives offered on a state-by-state basis throughout the United States to encourage in-state film production. Many states provide financial incentives for film and television production. ![]()
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