How the Fiscal Cliff helped Hollywood.
That fiscal cliff drama last week was better than some shows I’ve seen! Special holiday sessions of Congress, negotiations into the wee hours, nonstop blame-games . . . but we finally got a deal. (Sort of.)
A little known fact is that buried into section 317 of the fiscal cliff deal was an extension for “special expensing rules for certain film and television productions.”
So as arguments were being made on how high to increase taxes, Tinsel Town got a breather.
See it all started back in 2004, when Congress first passed “production tax incentives,” which were extended in ’08 and set to expire in ’11.
And as this article on the subject says, “The fiscal cliff deal extends the tax incentives through 2013–even as payroll taxes rise on ordinary Americans.”
But that’s not what I’m blogging about. This isn’t a poli-blog (yet).
What I’m irked about (again) is the consistent show of support that Hollywood gets from our legislative bodies, when Broadway gets squat. Now look, I understand. For one, a lot of television and film production went to Vancouver and overseas, and when that happens our country loses revenue, so part of the reason to keep these incentives going is helping keep production here (I’d like to see the stats on whether it has really helped, however). For two, Hollywood has a super wealthy and highly visible lobby of its own, and we . . . uh . . . do not.
While we’ve gotten a few bits and pieces of tax relief over the years, we’ve never seen anything substantial (how about some incentive for our investors?). The reason for the denial? Simple . . . if you want to produce a Broadway show, you can’t go to Vancouver. You can’t go overseas. Broadway only exists in one place. So our leaders look at us and say, “No tax relief? Poor babies. Go somewhere else if you don’t like it.”
Well you know what, my legislative friends? There’s a rumbling that’s just beginning in the new Producing Guard. Yep, I’m starting to hear the people sing. And they’re saying things like, “It’s so much cheaper to produce in London. I’m just gonna go there.” And, well, you read my blog yesterday about how I’d think about trying out a show in Australia versus the US next time. I know Korean producers who are actively looking to develop shows in their native land . . . because they get governmental support to do it.
So, congresspeople . . . you might think you’ve got us on location lock down . . . but the times they are a-changin’.
Let’s hope the tax laws do too.
(UPDATE FROM KEN: If this post interests you, check out this more recent post about Broadway and Potential Tax Credits.)
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