There’s a strong case to be made for bringing film and TV productions to Vancouver — experienced crews, talent, diverse locations, easy travel to Hollywood, and so on. But let’s face it, tax incentives have a powerful allure for producers.
With the phasing out of the of the harmonized sales tax (HST) and the increases in incentives in Eastern Canada, Vancouver finds itself in a precarious situation.
The HST combines the 7% provincial sales tax with the 5% goods and services sales tax levied by the federal government. Come April 1, the provincial portion will no longer be refundable to film and TV productions.
And as far as Hollywood producers are concerned, that would turn Vancouver into an ugly duckling.
“There’s obviously a long history between Vancouver and L.A. in working together,” says Vancouver’s mayor Gregor Robertson, “lots of people (go) back and forth between our cities, cracking out the best in film and TV.”
Robertson has been doing his own commuting, shuttling between Vancouver and Hollywood to meet with studios and encourage them to bring their movie shoots to the city. Along with the Canadian consulate general in L.A., he’s also pushing Canada’s federal government to introduce special tax credits for tentpole pics, to ensure that there’s a tax advantage for big stars to come do movies here.
“We have an attractive tax credit program for B.C.,” he says. However it’s not as compelling for tentpoles; that piece remains missing. “It seems like a good opportunity right now with the big stars since we don’t give their giant salaries a break like other places.”
As for the HST phasing out, Robertson admits that’s a cause for some concern and says the B.C. government is looking at opportunities to mitigate any impact.
He is also lobbying the B.C. government to do its part so film and TV can remain strong.
Lee Malleau, CEO of the Vancouver Economic Commission, says, “One of the things we’ve done is work with the provincial government’s expert committee on taxation and we have made presentations to lobby the provincial government and its tax experts.”
According to Malleau, the government is indeed looking at alternatives that can replace the conditions that the HST would have provided. “Certainly the expectation is that it’s going to happen,” she says. “From our perspective it’s a matter of when and how quickly it can be instituted.”
However, Malleau cautions it is important to maintain a balance and not get into a fierce competition over incentives. “At what point do tax credits actually start to undermine a healthy economy?” she asks.
Vancouver is already quite competitive, Malleau says, and the region has other advantages that others do not.
The film and television industry, in turn, adds a tremendous value to the city, say the pols. They say is an area of the economy that has the potential for great growth, it employs many highly skilled people, it’s a non-polluting industry, and it adds a creative dynamic to the city that you cannot put a price-tag on.
“It’s about more than pure economics, it’s about what are the values associated with your city and making sure you contribute to making a good business case for it,” Malleau says. “You’re going to end up with a much more vibrant city.”
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