Jun 26

Tax Credits And Why They Matter To Missourians– Who Pays To Bring Some of Hollywood to Missouri?

Who Pays To Bring Some of Hollywood to Missouri?


(St. Charles, MO) – When politicians, activists and the media talk about tax credits, they’re just talking about numbers on a spreadsheet that are more of a political debate than a “real” issue, right?




It may be a complicated issue at times, but those on both sides of the discussion agree on one thing: any decision on tax credits impacts you.


On “Missouri Viewpoints”, Patrick Werner, the State Director for Americans for Prosperity, says “we spend $600 and sometimes $700 million dollars, cumulative, on all of those tax credits that exist [in Missouri]. And that really does impact Missourians because those are tax dollars at the end of the day.”MWSnap011


In simplified terms, governments want to entice economic activity to the state or to specific areas. With tax credits, they offer to not charge some taxes in exchange for that activity. That could be bringing a business here or investing in facility expansion that makes moving away less likely. It could be an incentive to add jobs to an existing business or to hire people from specific demographics like military veterans.


Occasionally, actual rebates of some costs are involved as well.


Missouri has dozens of tax credit programs and some say, as a whole, the process and use of tax credits has gotten out of hand and costs too much. Efforts to enact sweeping overhauls of the tax credit process have come up short in recent legislative sessions.


Werner thinks that’s because tax credits aren’t generally partisan; they can be local and that means lawmakers are looking out for their districts. When over 100 legislators have specific interests in individual programs, it’s difficult to find a consensus for sweeping changes.


“Because you have so many different tax credits out there, because they impact so many different districts or legislative areas across the state, coming up with a singular, comprehensive reform program has been difficult.


“I think you’d be hard pressed to walk the halls in Jefferson City and find an elected official that doesn’t think there needs to be some sort of oversight or reform as it relates to the tax credit program.”


Getting from an agreement on that concept, though, is a long way from finding agreement on a plan to make changes. Werner isn’t calling for the elimination of all tax credits but thinks they should be used more strategically and with the entire state in mind.


“If we want to get additional funds for education or roads and bridges, then we really have to take a look at what’s going to move the state forward comprehensively. What’s really going to attract new people, new jobs, new tax dollars and grow this state in a much larger fashion.


“There definitely needs to be reform and oversight…and those that aren’t working, we need to get rid of. Those that are producing true reform, true job growth, true economic impact for the state we need to keep.”


One of those tax credit programs that has been debated in recent years is the film tax credit. That one has actually gone to the political chopping block and did not survive. It expires later this year and Joni Tackette from the Missouri Motion Media Association hopes to see it revived in next year’s legislative session.


While the film tax credit has never been particularly large compared to some of the other programs on the books, Tackette says it has worked and generated jobs.


“There’s a production community that has kind of built itself around the prospect of having additional opportunities come in to work on. So, to just get rid of it is very detrimental to the production community in the state of Missouri.”


The tax credit program can be used for both feature films and for television production.


As an example of the impact of the tax credit program, Tackette refers to “Up In The Air”, a 2009 film starring George Clooney that shot several scenes in the St. Louis area. Producers of that film actually received a multi-million dollar check from the state government but she says it was worth it.


“They were awarded $4.1 million. The way they received that was they proved that they spent over twelve million dollars in our economy, in Missouri.”


According to Tackette, the money spent by Paramount Pictures wasn’t only on actor salaries and bringing in camera equipment. She says the incentive helped bring business to everything from hotel and car rentals to restaurants to office supplies and dry cleaners.


That’s the idea behind tax credits in general, supporters say. Others don’t like the idea of government picking which industries get financially supported and which do not.


Tackette thinks the Film Tax Credit should have a broader appeal and hopes it’s not looked at as a special interest.


“Unlike the amateur sporting event incentive, the film tax incentive can be used all over the state. For the amateur sporting event incentive you actually have to have a facility and be able to host an event, so there are some parts of our state that will get no part of that incentive.


“When it comes down to film, Missouri is a back lot all over the state.”


On the web:


Americans for Prosperity – Missouri: http://americansforprosperity.org/missouri/


Missouri Motion Media Association: http://www.Mommaonline.com



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