Friday, December 25, 2009

Taxing Times For NYC Film Industry

New York City is in the process of imposing still more fees on film companies that seek to do business in the City. They claim that they need to cover the administrative costs for those films to do business there and that the fees are less than what private businesses can charge for location shoots.
One critic calls the $3,200 price tag for a permit to film at one of the city's buildings the highest fee in the nation by a municipality.

But the city, which attracts about $5 billion in business each year through the film trade, defends it as a small increase affecting a slim percentage of productions in a place that has long been among the friendliest filming venues in the country.

The city came up with the fee over the summer as it looked to cover more costs related to film productions, according to Marybeth Ihle, a spokeswoman for the Mayor's Office of Film, Theatre and Broadcasting. The fee took effect Wednesday.

"Private locations can charge $10,000 a day so this is pretty nominal," she said, adding that the fee affects only about 5 percent of productions that shoot scenes in New York City.
Mind you that the film businesses pump billions of dollars in to the City's economy in direct and secondary benefits. They also benefit from state tax credits for film and television credits.

The benefits to the City by being more amenable to film companies vastly outweigh the fees that they're hoping to recoup. It yet another layer of bureaucracy that makes it all the more difficult to do business in the City. Why would a film company do a location shoot in the City when they could avoid the costs by shooting in a studio in a more favorable tax and business climate?

So, while the City tries to rationalize that the location shoot fee wont discourage films from being shot on location in City owned properties, watch for some film companies to look for alternatives that avoid the fee. It will also discourage small filmmakers who are trying to get a start and can't afford studio and stage space to recreate those public spaces.

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