B.C. film tax credits have been a massive boon for the province’s entertainment industry.
So much so that the province is putting their massive costs under review.
Provincial tax credits for the film and TV industry averaged about $255 million a year from the 2010-11 to the 2013-14 fiscal years, according to the provincial budget released Tuesday (February 16).
But those costs spiked 93% to $493 million in the 2015-16 fiscal year as the value of the Canadian dollar plummeted and American productions flocked across the border.
Finance Minister Mike de Jong said during a technical briefing with reporters earlier this week that the government will have to take another look at the significant tax credits offered to the film and TV industry.
The latest provincial budget, meanwhile, lays out plans to “limit the growth of film tax credits” across 2016-17 through to 2018-19.
“Representatives of the film industry have recognized the pressure the rising cost of film tax credits are having on the government’s fiscal capacity and have approached the government to work together to seek ways to address this pressure,” the provincial budget stated.
Alex Godfrey, president of Vancouver’s Ironwood Studios, said limiting tax credits wouldn’t sit well with those working in the industry.
“Every force would impact business — the dollar, the tax credits,” he said.
“If you take away one of those things it’s obviously going to affect the business that is coming into B.C.”
The government offers tax credits on labour spending ranging from 33-35% depending on whether a production is foreign or domestic, respectively.
Productions qualify for additional credits if work is done outside Metro Vancouver, or for visual effects, animation or post-production work.
Members of the B.C. film industry mounted a campaign in the lead-up to the 2013 provincial election to pressure the incumbent BC Liberals to boost tax credits for the industry.
The additional tax credits never materialized but the film sector began to pick up again by the end of that year.