Tuesday, November 2, 2010

Arts Subsidies: Film

So, if you've been reading deficit hawk's economics over the last two years (and really you probably shouldn't be, if you want to remain sane and healthy), you'd know that tax breaks and monetary support are two different ways to subsidize things, with their own pros and cons.

Lately, Republicans have become the party of tax breaks, and the Democrats have become the party of monetary support, and the American people on both sides have become very frigid towards monetary support, while not treating tax breaks as equivalent.

I was thinking about this in the context of the end of the U.K. Film Council. It's the body, in the UK, which (up until this current Comprehensive Spending Review) gave out monetary awards to filmmakers through a variety of funds and lotteries. In other words, it's a cash grant machine, like Welfare or Social Security or take your pick: it gives money for you to make films.

Here in the United States, we support film differently. We do it in state-by-state tax breaks; for instance, New York gives a 30% refundable tax credit. States compete to offer the biggest tax incentive; when I took "Producing for Film" we were taught that it was one of the most important considerations in selecting a place to film.

Interesting to reflect on. In the theater community, I've largely focused on monetary grants (like those given by NYSCA or the NEA), but one of our (potentially) bigger subsidies, though, comes to not-for-profits (or Fiscally Sponsored projects) in terms of sales tax relief.

I wonder how these two approaches stack up in their effectiveness. I do know one thing: when you give money in a grant, you almost always have to justify the work you're investing in. But when you couch it as a tax subsidy, you have to give everyone equal access to it, and therefore you're more likely to focus on the labor and purchasing that comes out of it.

In other words, it's easier to get a shitty film project a tax break than to get it a grant. I don't even know if policy-makers care whether or not the film makes it to the screen -- so long as it is hiring local laborers and buying local surprised.

Just a rumination about subsidies.

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