Tennessee study criticizes that state’s film incentives program

Nashville Scene reports:

As fans prepare for the series finale of Nashville, The Beacon Center of Tennessee has released a report highlighting the costs of film incentives.

The nonprofit, libertarian-leaning think tank’s report argues to Nashville fans and Nashville residents that the end of the show is an positive development when it comes to taxes.

“Calling Cut on Film Incentives” covers all of Tennessee’s film incentive recipients, but Nashville bears the brunt of the report, which cites the show’s $45 million in state incentives — the most taxpayer money of any project.

Beacon Center CEO Justin Owen stresses what he calls the poor return on investment that comes from film incentives.

“While we are against all forms of corporate welfare, film incentives have unquestionably proven to have the worst return on investment of any type of handout,” Owen says. “Studies show that film incentives have a return on investment of anywhere from just seven cents per dollar to 28 cents per dollar, an investment that only the government would make.”

As Locker Room readers know, there is a a growing body of research finding film incentives to be an ineffective policy tool for growing a state’s economy. Earlier this month, I discussed new research that found film incentives to be a weak policy tool even to grow the state’s film industry at the expense of the greater state economy.

Bradbury found that film incentives only have a weak association with growth in the film industry. They make a difference, but they are still only one of several factors that affect film production location choices.

There is a level of tax credits associated with the industry’s in-state growth, Bradbury found, but higher than that offers no association with any further industry growth.

That level is no greater than 10 percent.

Jon Sanders / Director of Regulatory Studies

Jon Sanders studies regulatory policy, a veritable kudzu of invasive government and unintended consequences. As director of regulatory studies at the John Locke Foundation, Jo...

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