Louisiana's Film Tax Credit: Another Source Of Loss State Revenue To Business.

Economist Loren Scott in a study for the Louisiana Department Of Economic Development concerning the film tax credit reported the following that appeared in the Times Picayune of 3/25.  (1)  In 2014 Louisiana spent $222 million in film tax credits and earned back only $51 million or about 23 cents on every dollar spent.  That does not represent a fair return of the tax payers money in this writers judgement.

The film tax credit has been in effect since 2002 and was introduced in the state legislature by then state law maker Steve Scalise.  Now 13 years later Scalise says he is open to change in the program to insure tax payers dollars are maximized.  Yeah right, 13 years after the fact.

Scott estimated the film industry brought in as much as $1 billion in sales and $728 million in household earnings in 2014 supporting as many as 12,100 direct and indirect jobs.  He then says the numbers may be skewed because those estimates were based on certified Louisiana spending numbers that include the multi million dollar payments made to well known actors, writers, directors and producers. That those numbers are heroic assumptions that these monies will actually be spent in Louisiana since these individuals are typically not Louisiana residents.  

The only reason the film tax credit is in the news is the state faces a $1.6 billion budget deficit for fiscal year that begins July 1 and looking for ways to find the money to balance the budget.  Reducing the tax credit is one way to put more tax income in the states treasury.

Louisiana's elected officials have been looking out for business interest instead of the tax payers interest and are willing to reduce state income in doing so and then cut higher education and health care to balance the state budget.  The average monthly state unemployment in 2002, the year the film tax credit was established was 5.9%.  In February of 2015 the unemployment rate in Louisiana was 6.2%.  In other words the unemployment rate is rising in Louisiana while the film industry enjoy more tax breaks and the state has less revenue.

Does anyone really believe Jindal, Scalise and the republican controlled legislature is looking out for the tax payers money and state revenue when the state receives only 23 cents for every dollar given in film tax credits?  Those actors, writers, directors and producers who Scott alluded too that are collectors of multi million dollar payments are laughing all the way to the bank and out side of Louisiana to boot.


This commentary written by Joe Lorio


Special Note:  California, the state the movie industry left to come to Louisiana, recently passed Texas as the No. 1 producer of job creation