Tax Credits For The Motion Picture Industry

In 2005 and 2007, Massachusetts enacted legislation to create generous tax subsidies for the motion picture industry. The Tax Expenditure Budget produced by the Department of Revenue estimates that in Fiscal Year 2008 and Fiscal Year 2009 the cost of these tax breaks will be approximately $63 million each year.1 This cost places it among the more expensive new initiatives approved by the state in recent years.

By describing how the tax credits work, what they cost, and what we know about how they have affected the state economy, this MassBudget Brief provides information to help readers examine whether these tax credits are an efficient use of economic development resources.