Chamber says Saskatchewan film tax cut kicked industry out at the knees

The
Saskatchewan Chamber of Commerce says the provincial government kicked the film
industry “out at the knees” when it unceremoniously cut the Film Employment
Tax Credit.

The
chamber and Sask Film released a study Tuesday that they commissioned to look
at the cost of the tax credit to the province.

The
study found the government contributed $7.8 million annually to the program and
got back $6.5 million in taxes, resulting in a net cost of $1.3 million for
taxpayers.

But
it also found film projects done under the program generated about $44.5
million in economic spinoffs, including revenue for hotels, equipment rentals
companies and people who work in the industry. About 850 jobs were created each
year, the report says.

Chamber
CEO Steve McLellan said that’s good bang for the buck.

“If
you could get that kind of return on every dollar you spent, you probably
would,” McLellan said at the legislature.

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The
decision to cancel the credit was a surprise in the March budget, but McLellan
said it was made without having key facts and without consultation.

“If
they had the number in their hand, at $1.3 million, I think their decision
would have been different,” he said.

Premier
Brad Wall said in March that Saskatchewan
was not going to participate “in the bidding war” between provinces with
respect to grants for the film industry. But he said there might be other incentives,
like a tax rebate, that the two sides could talk about.

The
cut left the industry reeling. Industry representatives said it would kill the
industry and force workers to move away.

Verite
Films, the production company behind the hit comedy series “Corner Gas,” said
in June that it was moving its head office move to Toronto
from Regina
because of the cut.

Culture
Minister Kevin Doherty disputed
McLellan’s numbers Tuesday and said the cost to taxpayers was higher. But he
could not immediately provide a figure to back up his point.

Doherty argued there could be economic
activity with any tax credit that gives “preferential treatment.”

“The
report shows that there is an economic benefit to the province with the film
industry here. I’ve never disputed that. I’ve never claimed that there wasn’t
an economic benefit,” said Doherty.

“The
report also shows is that there’s a cost to taxpayers. There’s a net cost to
taxpayers to support the ongoing film industry in the province. What we’ve
always argued is that this is not a sustainable model and that we had to look
for a better model and that’s exactly what we’re doing.”