TAX INCENTIVES ARE VITAL TO B.C.’S FILM INDUSTRY
Cost is high but worth it in terms of jobs, writes Alistair Bambridge.
It’s one of the defining — and most terrifying — scenes in the triple Oscar-winning movie The Revenant.
Yet when Leonardo DiCaprio’s frontiersman character is attacked by a bear, the real star of the show is the brutal beauty of the location — British Columbia’s Squamish Valley.
Actors and crew working on Hollywood’s toughest ever shoot endured temperatures of -40 C, and told of how their eyes froze shut and their fingers and camera gear locked together.
But B.C.’s cinematic beauty wasn’t the only thing that attracted the filmmakers to its frozen wilderness; it was also the warm reception given them from a tax point of view.
British Columbia offers generous tax breaks to filmmakers, with a system of tax credits allowing producers to claim back up to 28 per cent of their production costs.
Such fiscal largesse has played a crucial part in fuelling the success of “Hollywood North” — boosting both homegrown filmmakers and making the province a magnet for big-spending productions from south of the border.
With similar incentives available in Ontario and Quebec, it’s little wonder a record $2.6 billion was spent shooting movies in Canada last year — a 35 per cent increase on the year before. Nevertheless the success isn’t without cost, and in the last fiscal year, the country’s 388 film productions cost Canadian taxpayers $391 million.
Last year B.C.’s Liberal government cut the province’s film tax incentives from 33 per cent to 28 per cent, and now the newly elected NDP Minister of Tourism, Arts and Culture Lisa Beare has been notably silent on what she intends to do with the program.
Her silence has got many in Vancouver’s film industry worrying that the tax breaks could be slashed even further.
Of course any debate over tax breaks invariably boils down to one key question — are they worth the cost to taxpayers?
British Columbia’s film tax credits have clearly stimulated the film industry, boosting the province’s economy and creating jobs.
But to get a sense of the broader benefits they deliver, it’s worth looking at the example of my hometown, London (the English one, not the Ontario one).
The U.K.’s booming film industry, estimated at £1.6 billion ($2.7 billion), is expanding by 13 per cent a year and is now set to overtake China as the world’s second largest.
Tax incentives are at the heart of this success story. U.K.-made films — regardless of budget — can claim a cash rebate of up to 25 per cent from the British Treasury.
To qualify, productions must pass a test on their cultural importance to the U.K. — including assessments on the number of U.K. and European actors employed, as well as the film’s relevance to British heritage and locations.
In 2016 the U.K. paid out £415m ($698.7M) in film tax rebates — a 22 per cent increase on the previous year — helping fund 175 films which between them took $6.5 billion at the worldwide box office.
But it wasn’t just big budget blockbusters like Rogue One: A Star Wars Story that benefited — independent filmmakers have been big winners too. Between 2007 and 2015, 1,612 ‘micro-budget” films costing less than £500,000 ($842,000) were produced.
Jobs have been created across the industry and across the country. In the past five years the number of production companies has jumped by 43 per cent, and video and post-production firms by 30 per cent.
The British Film Institute says the boom hasn’t just benefited London — Yorkshire is Britain’s fastest growing region for film and TV production.
The BFI has now launched a £20m ($33.6M) recruitment drive to fill the 30,000 jobs it reckons will be created over the next five years. This includes roles across the film industry supply chain, from caterers to carpenters, accountants to hairdressers, and from nail technicians to security guards.
The result of this momentum is clear — Britain’s film industry is now the secondbiggest contributor to the growth of U.K. Plc, according to the government.
While U.S. film tax credits are nowhere near as generous as Canada’s, B.C.’s tax advantage is set to narrow under President Donald Trump’s plan to slash America’s corporate tax rate from 35 per cent to 20 per cent. It would be madness for the province to reduce that competitive advantage any further.
Film tax credits have turned movies into a golden goose for British Columbia. The U.K. example shows how a booming film industry can create jobs — and wealth — across a whole country.
So the last thing the NDP government should be doing is messing with the film tax credits program. Yes, it’s not cheap, but it has played a key part in the province’s economic success story — which last year saw B.C. lead the country in both GDP and job growth.
The NDP inherited a $2.8-billion budget surplus from the Liberals, and I urge it to use this to protect a program which provides an engine for the economy, for jobs and brands B.C. around the world.
Many of the Fraser’s 34 tributaries, or riversheds, have been damaged by human activity. That’s why a comprehensive approach to heal and protect this great river, that runs through half our province, is needed.
Kim Stephens, Ted van der Gulik and Fin Donnelly The last thing the NDP government should be doing is messing with the film tax credits program.