New York State offers tax credits to film, television, and commercial production companies to incentivize filming and post-production work within the state. This page covers CBC’s work on the Empire State Film Production Credit, the Film Post-Production Credit, annual program spending caps, return on investment analysis, and the evaluation of economic development incentives.
This page was created with AICBC Insights uses AI to group, analyze and present data and recommendations from CBC's publications. Always reference the cited sources to verify important details..
New York should amend its program to target incentives to the segments of the film industry that are at risk, while reducing or eliminating the incentives that generate little to no impact.
The State should retool our film tax credit programs to surgically target incentives to portions of the State’s film industry that are truly at risk while shrinking the amount being spent without impact.
Lawmakers can start by reining in the least effective tax breaks and better targeting the incentives that remain.
New York should ensure that tax credit programs are designed in ways that reward actual performance in key sectors, rather than hiring or investment that would have happened anyway.
New York should keep what works and amend, narrow, or eliminate programs that are ineffective.
Key Data
A November 2024 testimony highlights that New York's film production and post-production tax credits fail to generate a positive return, returning less than 30 cents in State tax revenue for every dollar of tax credits awarded after counting indirect and induced effects.
Reflecting on long-term expenditures, a November 2024 analysis shows that New York State has spent over $5.8 billion since 2007 on its film production, post-production, and commercial production tax credit programs with minimal return on public investment.
The CBC reported in November 2024 that the fiscal year 2023 State budget significantly expanded the program by increasing the annual cap from $420 million to $700 million and raising the share of eligible production costs that productions can recoup from 25% to 30%.
Looking at employment trends over two decades, a November 2024 report notes that New York added 18,000 film production jobs, but its share of national film production employment was 17.6% in 2022, representing less than a one percentage point increase from before the credits were enacted in 2004.
Writing in December 2017, the CBC explained that because of a rollover provision, once the annual cap is met, the State awards credits from future years' allocations, and requires companies claiming credits over $5 million to spread the claim over three years.
New York's film production and post-production tax credits have failed to generate a positive return on investment, returning less than 30 cents for every dollar awarded while costing the state over $5.8 billion since 2007. Rather than continuing to expand these programs, the state should retool them to surgically target segments of the industry that are truly at risk.
Recommendations related to Film Tax Credit
New York should amend its program to target incentives to the segments of the film industry that are at risk, while reducing or eliminating the incentives that generate little to no impact.
The State should retool our film tax credit programs to surgically target incentives to portions of the State’s film industry that are truly at risk while shrinking the amount being spent without impact.
Lawmakers can start by reining in the least effective tax breaks and better targeting the incentives that remain.
New York should ensure that tax credit programs are designed in ways that reward actual performance in key sectors, rather than hiring or investment that would have happened anyway.
New York should keep what works and amend, narrow, or eliminate programs that are ineffective.
Key Data
$5.8 billion
— Total spent on Film Production, Film Post-Production, and Commercial Production Tax Credit programs since 2007.
30 cents
— Return in State tax revenue for every dollar of tax credits awarded for film production and post-production.
$700 million
— The annual cap for the film tax credit following the fiscal year 2023 State budget increase.
17.6 percent
— New York's share of national film production employment in 2022.
$878 million
— Georgia's film tax credit cost in foregone tax revenue in fiscal year 2023.
17,000
— Number of film production jobs in Georgia in 2022.
New York should veto legislation that retroactively expands the Empire State Film Production Credit, as it unnecessarily depletes state resources for productions already committed to filming in the state. Instead of engaging in a costly "race to the bottom" with other states through tax incentives, the state should prioritize economic growth by leveraging its existing comparative strengths and improving the business climate.
Recommendations related to Film Tax Credit
The Governor should veto S7562/A7757, which expands eligibility for the Empire State Film Production Credit.
New York should focus on expanding its economy based on its comparative strengths, such as human capital and cultural and natural amenities.
The State should enhance its willingness to make it easier to do business in New York rather than competing on the deepest pockets.
New York State has significantly expanded its film tax credit, raising the annual cap from $420 million to $700 million despite a history of demand exceeding the previous cap. This expansion is part of a broader trend of increasing economic development spending that lacks sufficient evidence of cost-effectiveness or job creation.
Recommendations related to Film Tax Credit
The State should rigorously evaluate existing incentives and programs, including the film tax credit, to determine their effectiveness.
Policymakers should narrow, shrink, or eliminate programs that are not proven effective, rather than expanding them.
The State should adopt performance-based incentives whenever possible to ensure taxpayer funds are used efficiently.
The State should create a unified economic development budget to better track and manage spending across all programs.
The State should increase oversight powers of the State Comptroller and Authorities Budget Office to ensure greater accountability for economic development spending.
Key Data
$700 million
— The new annual cap for the film tax credit following its expansion in the Fiscal Year 2024 Enacted Budget.
$420 million
— The previous annual cap for the film tax credit before the recent expansion.
25 percent
— The rate of the fully refundable credit offered on production and post-production costs prior to the recent expansion.
4 years
— The number of consecutive years the State has issued film tax credits exceeding the previous $420 million cap.
50,000 is the number of jobs New York State expects to be created over the next 20 years by attracting Micron to central New York with $7.2 billion of incentives. New York has long been a leader in economic development, with the State and localities offering tax incentives and spending…
New York's proposed expansion of the Empire State Film Tax Credit to a potential lifetime cost of $14.6 billion lacks rigorous evidence demonstrating that the program effectively attracts productions or generates sufficient economic activity. Instead of increasing annual credit caps from $420 million to $700 million for unproven programs, the state should prioritize investments in human capital, infrastructure, and essential public services.
Recommendations related to Film Tax Credit
New York should conduct a thorough, rigorous evaluation to identify whether the film tax credit program has induced additional economic activity.
New York should stop expanding the film tax credit without performing a rigorous analysis to demonstrate whether the program was needed to attract productions.
New York should focus on developing human capital, providing high-quality, essential public services, and maintaining its infrastructure instead of depleting resources for unproven programs.
Key Data
$14.6 billion
— Possible lifetime cost of the film tax credit under the executive budget proposal.
$9.6 billion
— Current lifetime cost of the film tax credit.
$6.5 billion
— Amount already granted in film tax credits without performing a rigorous analysis.
$420 million
— Current annual credit cap for the film tax credit.
$700 million
— Proposed annual credit cap for the film tax credit.
The proposed expansion of the Empire State Film Tax Credit, which would increase the lifetime maximum cost by 55 percent to $14.6 billion, should be rejected due to a lack of rigorous evidence demonstrating its economic necessity or cost-effectiveness. Instead of expanding the program, the state should conduct a comprehensive evaluation of the credit's impact and opportunity costs to determine if it should be phased out.
Recommendations related to Film Tax Credit
The State should reject the proposed expansion of the Empire State Film Tax Credit.
Until a rigorous analysis justifies some form of incentive, the State should be shrinking the program.
The State should perform a rigorous evaluation to determine what economic activity was induced by the incentive, estimate the benefit of that additional economic activity, and compare it to the cost of the program and the impact of using those resources in another manner.
The forthcoming evaluation of State tax incentive programs should inform the existence and design of the film tax credit programs instead of actions by other state’s legislatures.
Tax incentives should only be provided if justified by rigorous analysis.
Key Data
$14.6 billion
— The proposed lifetime maximum cost of the film tax credit program under the Executive Budget.
$9.4 billion
— The lifetime maximum cost of the film tax credit program under current law.
55 percent
— The increase in the total maximum cost of the film tax credit program under the proposed expansion.
$700 million
— The proposed annual credit cap for the film tax credit starting in 2024.
$420 million
— The current annual credit cap for the film tax credit program.
$6.5 billion
— The total amount of credits provided since the start of the film tax credit program.
New York's film tax credit, which ranks among the state's largest annual economic development tax breaks, fails to generate commensurate economic impact. Consequently, this costly incentive should be phased out and ultimately eliminated to improve fiscal responsibility.
Recommendations related to Film Tax Credit
The film tax credit should be phased out and ultimately eliminated as it does not provide commensurate economic impact.
New York State's film tax credit provides unnecessary subsidies to an established, profitable industry and lacks rigorous, standardized evaluations to measure its actual effectiveness. The current biennial reviews of the credit fail to compare its performance to other programs or establish whether it meets key benchmarks, erroneously implying that all supported jobs would not exist without these subsidies.
New York State has allocated $7.8 billion in tax incentives to the film and television industry since 2004, yet the program has failed to produce sufficient value and should be eliminated to help stabilize state finances. Given the state's $9 billion budget gap and projected deficits, the credit should be significantly reduced or repealed to prioritize more effective use of public resources.
Recommendations related to Film Tax Credit
The State should eliminate the film tax credit entirely, as it has not produced enough value for New Yorkers.
The State should stop awarding from future year allocations to ensure that the annual cap effectively limits the increase in state liability each year.
The State should stop spreading claims over 3 years, as this extends the distance between job creation and the state's financial impact.
The State should decrease the credit substantially to 10 percent of qualified costs and eliminate the annual cap to reduce the program's cost.
The State should further decrease the share of expenses that can be claimed in New York City to push production to areas of the state with a greater need for economic development.
Key Data
$7.8 billion
— Total tax incentives allocated to the film and television industry by New York State since 2004.
$420 million
— Annual cap on the film tax credit through 2025.
$9 billion
— Current budget gap facing New York State.
$19 billion
— Projected annual deficits for New York State in fiscal year 2023.
25 percent
— Rate of the refundable film tax credit for qualified production and post-production costs.
$12 million and $15 million
— Annual amount collected by Saturday Night Live between 2015 and 2018 despite having filmed in New York City since 1975.
Since 2004, New York has authorized $7.3 billion in subsidies for the film and television industry through its tax credit program. To address this, the state should begin a full phase-out of the credit by incrementally reducing the share of eligible expenses until the program is eliminated.
Recommendations related to Film Tax Credit
The State should begin the film tax credit's full elimination by decreasing the share of eligible expenses in 5 percentage point increments until it is completely phased-out.
Key Data
$7.3 billion
— Total subsidies authorized to the film and television industry since the enactment of the State film tax credit in 2004.
$420 million
— The amount by which the Executive Budget proposes to increase the total allocation for the film tax credit.
30 percent to 25 percent
— The proposed decrease in the share of expenses that may be granted as a refundable film tax credit in most instances.
The New York State budget agreement includes an additional $840 million allocation for the film tax credit, despite concerns regarding its wastefulness and lack of transparency. This spending increase occurs alongside other budget decisions that fail to adequately prepare the state for potential economic downturns.
Key Data
$840 million
— The amount added to the film tax credit in the New York State budget agreement with minimal commitment to increased transparency.
New York State is facing a significant revenue shortfall driven by federal tax changes and economic volatility, requiring immediate action to close budget gaps. To address this, the state should reduce spending on economic development programs that have not been proven effective, such as the film tax credit.
Recommendations related to Film Tax Credit
The State should decrease State economic development programs that have not been proven effective, including the film tax credit.
New York State extended the Empire State Commercial Production Tax Credit, which is capped at $7 million annually through 2023. This program supports the advertising industry and was signed into law in December 2018.
Key Data
$7 Million
— The annual cap for the Empire State Commercial Production Tax Credit, which was extended through 2023.
New York's Film Tax Credit program is a wasteful expenditure that should be repealed, though the state will not see immediate financial savings due to existing rollover provisions and multi-year claim requirements. Because the state has already allocated credits for future years, the budget will not realize the full benefits of a repeal for at least four years.
Recommendations related to Film Tax Credit
The state should repeal the Film Tax Credit program.
The state should pursue the timely repeal of this wasteful credit to eventually realize financial benefits.
Key Data
$420 million
— The annual cap for the Film Tax Credit program, which is effectively rendered superfluous by rollover provisions.
$5 million
— The threshold for film companies claiming credits to be required to spread their claim over three years.
$6 million
— An example of a credit awarded in 2017 from the 2019 allocation, which would result in subsidies being paid out as late as 2022.
New York's Film Tax Credit program has ballooned from an initial $25 million annual cap to a $420 million expenditure, serving as a cautionary example of how narrowly focused economic development incentives expand over time. Consequently, new tax credit proposals should be rejected until existing programs are properly evaluated and reformed to ensure they provide a clear return on investment.
Recommendations related to Film Tax Credit
The Governor should veto the three bills that would expand the State’s economic development programs, as narrowly focused incentives like the Film Tax Credit Program do not provide a return on investment.
No new programs should be approved until reforms are put in place to improve evaluation, procurement, and disclosure requirements and existing spending is effectively evaluated, particularly given the history of the Film Tax Credit Program growing from $25 million to $420 million.
Narrowly focused economic development incentives, such as the Film Tax Credit Program, should be curtailed rather than expanded.
Key Data
$25 million
— The original annual cap for the Film Tax Credit Program when it was first adopted.
$420 million
— The current annual cost of the Film Tax Credit Program, which has grown significantly since its inception.
$5 billion
— The total amount the State currently spends annually on economic development programs.
$5 million
— The annual allocation cap for the proposed new refundable tax credit for companies that hire female and minority writers and directors.
Read original article here . Governor Andrew Cuomo is back in New York after a rare, overnight trip to California, fundraising with Hollywood executives whose industry has benefited from New York's $420 million film tax credit program. "It's a glamorous form of coporate welfare," said Ken Girardin, Empire Center analyst.…
The state should reject the proposed three-year extension of the Empire State Film Tax Credit, as the industry is already well-established in New York and the program costs taxpayers $420 million annually. Many other states have already moved to repeal or reduce similar subsidies, suggesting New York should follow suit.
Recommendations related to Film Tax Credit
It is time for New York to repeal or substantially decrease the film tax credit.
Key Data
$420 million
— Annual cost to state taxpayers for the film tax credit.
Extending the Film Tax Credit for three years is ill-advised because the movie industry is already profitable and does not require state subsidies. This policy change allows companies to file for payments they will not receive until after 2019, representing an unnecessary use of public funds.
Recommendations related to Film Tax Credit
Extending the Film Tax Credit for three years is a mistake because the movie industry is profitable and should not be subsidized.
The Film Tax Credit Program has ballooned from an initial $25 million annual cap to a $420 million expenditure, serving as a cautionary tale against creating new, narrowly focused tax credits for music and digital gaming. These new proposed credits, estimated to cost $150 million, should be rejected in favor of comprehensive budget negotiations rather than piecemeal tax policy.
Recommendations related to Film Tax Credit
Governor Cuomo should veto A.10083-b/S.7485-b, which would create new tax credits for music and digital gaming media production.
Narrowly focused tax credits, such as the Film Tax Credit, do not provide a return on investment and should be curtailed, not expanded.
Matters of tax policy that have significant budget implications should be dealt with in the midst of budget negotiations and an overall financial plan.
Key Data
$25 million
— Original annual cap of the Film Tax Credit Program.
$420 million
— Current annual size of the Film Tax Credit Program.
$25 million
— Annual cost of the proposed new tax credits for music and digital gaming media production.
$150 million
— Total estimated cost of the proposed new tax credits for music and digital gaming media production over three years.
New York's film and TV production tax credit program, which offers a 30 percent credit on qualified expenditures, resulted in a net loss of $570 million in tax revenue from credits awarded in 2013 and 2014. Despite the program's significant cost, there is a lack of evidence demonstrating that these subsidies generate positive economic returns for the state.
Recommendations related to Film Tax Credit
Before expanding tax credit programs, state leaders should have sought better evidence that these large subsidies produce positive returns for New York.
Other economic development programs would benefit from similar economic impact analyses as the one conducted for film and TV production.
Key Data
$570 million
— The State will net a loss of $570 million in tax revenue from film and TV production credits awarded in 2013 and 2014.
30 percent
— The fully refundable film tax credit equals 30 percent of qualified expenditures.
Reforming the state's largest business tax incentive programs, including the Film Tax Credit, would tighten eligibility requirements and generate $180 million in annual savings. Periodic reviews and increased transparency regarding these tax breaks are essential to ensure the effectiveness and accountability of state business incentives.
Recommendations related to Film Tax Credit
The State should implement reforms to the Film Tax Credit to tighten eligibility and save money.
The State should conduct periodic reviews of the costs and benefits of business tax incentive programs like the Film Tax Credit.
The State should provide expanded transparency on which businesses benefit from tax incentive programs such as the Film Tax Credit.
Key Data
$180 million
— Annual savings projected from tightening eligibility for the Investment Tax Credit, the Film Tax Credit, and the Brownfields Tax Credit.
The proposed state budget includes an $800 million increase in economic development spending, which includes $420 million for film tax breaks. This expansion should be halted until the state can systematically scrutinize and justify the effectiveness of these business subsidies.
Recommendations related to Film Tax Credit
New York should not increase expenditures for economic development, including $420 million for film tax breaks, until the state more systematically scrutinizes and justifies its subsidies for business.
Key Data
$420 million
— Proposed allocation for film tax breaks within the economic development budget.
$800 million
— Total increase in spending for economic development activities in the proposed budget.
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