Film tax credit sunset looms

THE CHAIR OF THE SENATE WAYS AND MEANS Committee sounds as if he is in no hurry to eliminate the sunset provision contained in the state’s film tax credit law.

The tax credit, launched in 2006 and scheduled to sunset on December 31, 2022, has been the focus of a number of attempts to eliminate it or pare it back. All of those efforts failed because they required passing new legislation that was blocked in the House, where support for the film tax credit is strong. But now proponents of the tax credit need to pass legislation to eliminate the sunset provision, and Rodrigues, who has favored paring back the film tax credit in the past, indicated in an interview that his feelings about the credit have not changed.

“I still have concerns about the cost of the film tax credit,” he said. “I still have concerns on whether or not the Commonwealth is getting adequate return on its investments in the film industry.”

The film tax credit offers anyone shooting films, TV shows, or commercials in Massachusetts a credit equal to 25 percent of whatever they spend. The credits can be converted into cash by either selling them back to the state at 90 percent of their face value or by selling them to a corporation or individual with a large tax liability in Massachusetts.

Even though the film tax credit is not scheduled to sunset until the end of 2022, backers say the uncertainty about the credit’s future could lead to diminished investments by movie makers in Massachusetts over the next few years.

David Hartman, director of the Massachusetts Production Coalition, issued a statement saying the film tax credit has created thousands of jobs and supported businesses in 265 Massachusetts municipalities.

“Massachusetts workers and businesses in the state’s film production industry are grateful to the Legislature for their years of support that have helped make Massachusetts a leading filmmaking destination,” he said. “As the looming end date of the production incentive program puts these jobs, and the families that depend on them, at risk, we look forward to working with legislative leaders to protect – and expand – the good-paying jobs and business opportunities that the film industry creates in Massachusetts. With the exponential growth in streaming content produced by Netflix, Disney+, Hulu, Apple TV+, and others, Massachusetts has a critical opportunity to continue to attract multi-year episodic series that will create even more jobs and business opportunities in the future.”

Rodrigues said he continues to have concerns about the cost of the tax credit, but he stressed that the Senate as a whole has not discussed the issue in a long time and no decision has been reached about what to do. He noted the film tax credit is very popular with many members of the House and Senate.

“Remember, a tax credit is like a grant,” Rodrigues said. “The data seem to prove that it’s very expensive, that it does not create many full-time equivalent jobs. There’s a burst of activity during a particular filming and then activity ceases when the film goes away. The credits tend to benefit out-of-state residents.”