the epidemic of Hollywood tax breaks

Since I started this blog this past May, by far the most common type of tax incentives that I have come across have been those targeted at the film industry. Within the past week, media outlets in Georgia, Indiana, South Carolina, and Texas have touted the alleged benefits of these incentives and issued warnings in case such breaks are not granted. Given the frequency of these types of articles, I have come to the conclusion that Hollywood has a stranglehold on state policymakers.

State-run organizations such as the Texas Film Commission and the South Carolina Film Office sound great. And it is certainly a lot sexier (politically and otherwise) to say you live in a state where Hollywood film execs come to play instead of bragging that your state attracts investment in a variety of industries.

But this favoritism needs to stop. It is unsound way to encourage long-run investment and is completely unfair to those who lack significant political access. Just because your business does not allow a governor to fulfill a childhood dream does not mean you are less deserving of low taxes.