After a proposed bill that would have canceled the Oklahoma Film Enhancement Rebate Program stalled during the state Legislature’s 2017 special session, state Rep. Kevin Calvey (R-Oklahoma City) says he will try again in 2018.
In September 2017, Calvey proposed House Bill 1004 (HB 1004), which would have ended the Oklahoma Film Rebate Enhancement Program, which distributes cash to film and television production companies filming in the state.
The Enhancement Program is scheduled to end in 2024. HB 1004 would have canceled the program on January 1, 2018.
The state’s House Rules Committee did not consider HB 1004 in 2017, Calvey told Budget & Tax News, but the bill will be rebooted in January 2018.
“On the film tax credit repeal bill, it won’t be heard in special session,” Calvey wrote in an email to Budget & Tax News. “Either I, or someone else, will refile it in January for [the] regular session.”
Not for Everybody
Jeremy Horpedahl, an assistant professor of economics at the University of Central Arkansas, says film tax credits benefit movie producers at everyone else’s expense, except when they don’t benefit anyone.
“In general, economic research finds that tax incentives usually do benefit that targeted industry, though often at the expense of the economy as a whole,” Horpedahl said. “Somewhat surprisingly, only about 65 percent of the studies that I’m aware of find clear positive effects for the firms that receive the subsidies.”
Film tax credits don’t play a starring role in movie producers’ decisions, Horpedahl says.
“While taxes are important for most economic decisions, they are not the deciding factor, and many films would still be made in the state without the credit,” Horpedahl said.
Picking Winners and Losers
Trent England, executive vice president of the Oklahoma Council of Public Affairs, says the logic behind film tax incentives is dubious.
“I think that the fundamental question is why politicians should pick one kind of economic activity over any other kind of economic activity,” England said. “Wouldn’t we all rather have a level playing field within Oklahoma, and across the country, when it comes to filming or anything else?”
Most Oklahomans support getting rid of special tax treatment and subsidies, England says.
“There’s just no question that most Oklahomans support getting rid of these special handouts in the tax code that benefit popular special interests at the expense of every other taxpayer in Oklahoma,” England said.