Newly released state revenue data shows that Massachusetts taxpayers played a significant role in funding a mid-budget Hollywood movie about climate change.
black comedy Don’t look up Premieres on Netflix in December 2021. A straightforward fable, this film attempts to do something about climate change Dr. Strangelove Made for nuclear war.
The film grossed just under $800,000 worldwide against a budget estimated at $75 million to $110 million. (Since the film debuted on the streaming service, box office receipts have been more important than ratings: Audiences streamed the film to watch 111 million hours in the first two days, then watched an additional 1.52 million hours the following week Billions of hours.
type Stars Leonardo DiCaprio and Jennifer Lawrence took home $30 million and $25 million respectively, the report said, but that total included money provided by Netflix to compensate for the film not being released in theaters. A case of wide release, as stars can negotiate a percentage of the box office revenue. But it turns out that more than half of the production budget comes not from deep-pocketed studios or producers, but from Massachusetts taxpayers.
Like many other states, Massachusetts offers tax credits for film and television productions filmed in the state. Specifically, Massachusetts offers a credit worth 25% of the production expenses and payroll tax obligations incurred by the Bay State. If the credit exceeds the producer’s Massachusetts tax liability, they can claim 90% of the remainder as a refund. There is no maximum limit, and the credit is transferable, meaning the production company can sell it to another company or taxpayer and pocket the cash.
This month, the Massachusetts Department of Revenue released updated data for the 2021 tax year. Most of the film tax credits go to things like this old house ($545,159 total for both series) and Antiques Roadshow ($687,403 for two seasons). But the new data also shows that the state reported a total of $73.3 million in film tax credit spending in 2021, with a whopping $46.3 million spent on Don’t look up.
In other words, Massachusetts taxpayers paid more than 84% of the two stars’ salaries, or 42% to 61% of the film’s total budget.
Proponents of such programs argue that they stimulate the economy: “The magnitude and benefits of film tax credits to Massachusetts are immeasurable, creating local jobs and boosting overall economic activity in our cities and towns,” the state House Speaker Ronald Mariano (D-Quincy) said after the Legislature voted to make the points permanent in 2021. State Rep. Dick Chan (D-Quincy) said Don’t look up Refers to the number of hotel rooms rented in the state for more than 15,000 nights.
But the evidence does not bear out this optimism. According to a 2021 report from the Tax Expenditure Review Commission, while “by its very nature, this credit would generate a direct and measurable expenditure in the Massachusetts economy…the film credit does not generate anything other than a one-time expense.” Make a clear impact.”
The same is true in other states. State auditors found that Georgia’s film credit program cost the state $160,000 per job created, with a return on investment of just 19 cents. According to the New York State Government Economic Development Entity, “The Film Production Tax Credit Program is designed to strengthen New York State’s film production industry and its positive impact on the state’s economy.” But while state lawmakers plan to spend up to $100 on production credits this year $700 million, but a December 2023 audit found the credits were “at best a break-even proposition and more likely a net cost” with a return on investment of 31 cents on the dollar.
exist Don’t look upWriter-director Adam McKay has crafted a fable about climate change denialism, similar to how he previously depicted the 2007-08 financial crisis in “Climate.” big short. Perhaps in his next film, he can turn his trademark wit toward another public policy flaw: central planners’ tendency to use other people’s money to shape the world to their own will.
