Patrick Button speaks on tax incentives that accelerated growth of the movie industry in Louisiana.
Patrick Button, an associate professor of economics and the executive director of the Connolly Alexander Institute for Data Science at Tulane University, recently shed light on the significant role of tax incentives in shaping the landscape of the movie industry, particularly in Louisiana. His insights come from his extensive research, including his dissertation on film tax incentives.
According to Button, states began aggressively offering subsidies for film and TV production in the early 2000s, with a dramatic increase between 2005 and 2010, when the number of states participating jumped from fewer than 10 to nearly 40. Louisiana was among the early adopters in the 1990s, aiming to bolster its local film industry, create jobs, and promote local culture and identity.
These incentive programs typically allow production companies to recoup a percentage of their local expenditures—ranging from 20% to 35%—on elements like hiring workers, renting equipment, and accommodations. This money can be returned as a rebate check or a credit against local taxes, with a unique market even existing for buying and selling these tax credits. For many filmmakers, these subsidies are crucial in determining whether a project moves forward.
