Lalor: Don't Expand Hollywood Tax Subsidies, Cut Them

East Fishkill, NY - Assemblyman Kieran Michael Lalor (R,C,I - East Fishkill) is calling on the Assembly to reject legislation that would expand New York's film credit for several counties. The legislation is likely to be considered by the Assembly before the session ends on Thursday.

The 2013-14 state budget created an additional 10% Film Production Tax Credit on top of the 30% filmmakers already received, for film production in forty upstate counties. Two additional counties were added in the 2014-15 budget. This bill aims to add the additional 10% credit in a dozen other counties on Long Island, in the Hudson Valley and in the Capitol Region. In 2013, Governor Cuomo's own tax commission said the credit is too big and recommended scaling it back but subsequent budgets have continued to include the giveaway.

Lalor said, "This bill is supposed to level the playing field in the application of the tax credit. It's ironic that the beneficiaries of corporate welfare are whining that it's unfair for some parts of the state to get better tax treatment than others. The Hollywood tax credit carves out special tax treatment for a tiny part of our economy. The rest of the state's taxpayers are left with a heavier load in a state that already has the highest taxes in the nation. If we want to level the playing field in how the subsidy is applied around the state, we should reduce the subsidy in the counties where it's higher."

Lalor added, "Legislators are running for reelection claiming they achieved historic middle class tax relief in this year's budget, when, in reality, the cuts amount to an average of just $100 a year starting in 2018. That's assuming any subsequent budgets don't reduce or eliminate those slim cuts. Meanwhile, Albany is giving Hollywood $420 million a year in subsidies through 2019. We shouldn't expand the Hollywood tax credits before the end of session, we should eliminate them. Short of eliminating the subsidies, we should reduce them and give New Yorkers across-the-board tax relief instead."

Lalor continued, "The $420 million per year lifted off of Hollywood is put onto less glamorous industries and small businesses. It is a tax shift, not true tax relief. The film credit has not prevented layoffs. For example, Viacom announced in March 2015 that it was cutting 264 employees in New York. Viacom received about $340,000 in tax credits for TV production in the fourth quarter of 2014 alone. But, with the limited information about the credits available, it's likely that the actual number runs well into the millions when Viacom subsidiary Paramount Pictures is included. The jobs created tend to be temporary jobs for caterers, acting extras and set builders, but few of the kind of permanent full time jobs that can sustain a middle-class family in New York. Still, the average 'job' created costs the taxpayers a whopping $38,000 according to a study by Camoin Associates. Other states are cutting or eliminating their own film tax credits, but Albany stubbornly, with bipartisan support, keeps wasting tax dollars."