Film Subsidies and Economic Development

With all of the controversy surrounding possible shady business involving the New Mexico film industry and our tax dollars, it might be easy to forget that providing these subsidies in the first place is dubious economic policy.
Apparently, California is now discussing subsidies for the film industry to keep up with states like New Mexico. As the Orange County Register points out, “giving one industry tax money is government discrimination against every industry that doesn’t get tax money.”
The last thing New Mexico needs is to get into a bidding war with California over who can subsidize movie studies the most. Instead of providing subsidies to one narrow interest, Governor Richardson and the Legislature should focus on reducing gross receipts tax rates or on eliminating the income tax. Those are fair solutions that will provide far greater benefits to New Mexico’s economy.

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