The Hollywood Bailout
Now that the political filmmakers in Hollywood know that Barack Obama is president and they’re all suddenly happy to be Americans again, they can all go back to making mostly apolitical movies. But first, they’re going to need the money:
With even Hollywood facing an economic slump, the Senate Finance Committee's $275 billion tax title of the economic stimulus package would lend a hand to movie studios that have seen outside financing dry up.
Well perhaps they could cut some losses by, yunno, making better films for less. It’s already been announced that this provision has been stripped from the bailout. Oh sorry, I meant “stimulus package.” Who was supporting this anyway?
The Senate bill includes a tax break worth up to $246 million over 11 years for investors in bigger-budget movie projects that don't necessarily qualify for incentives currently. The provision is backed by firms like the Walt Disney Co., and the industry trade group the Motion Picture Association of America, according to aides and lobbyists.
The Walt Disney Company? The happiest place on Earth wants a piece of the pie? Sorry boys, I love you, but before you even consider asking for not-so-free money, you might want to consider apologizing for “The Shaggy Dog” remake.
Broadly speaking, the Senate bill includes a one-year extension through 2009 of a provision enabling companies to write off 50 percent of the cost of equipment placed in service during that year, same as in the House Ways and Means version. But the Senate bill amends the definition of "qualified property" to include "certain motion picture film or videotape," bringing the cost of the Senate provision to $5.32 billion, up from the House's $5.07 billion version.
Companies that use the tax break would then forfeit the right to use the existing incentive, which allows companies to deduct 100 percent of production costs up to $15 million. That provision is backed by groups such as the Directors Guild of America and is aimed at keeping smaller productions from relocating to foreign countries; it was extended as part of the $700 billion financial rescue plan in October.
But a problem arises for pictures that cost $30 million or more, which the option to instead use bonus depreciation attempts to resolve.
It probably wouldn't benefit blockbusters that take years to produce, a lobbyist said, given that, to benefit, a firm's asset must be placed in service -- hitting the theaters or video market -- during that time.
Oh, the agony. Look, I know that life must be hard producing movies for the price that most small companies don’t earn in a year, but you can do well for much less. I’ve been talking with my friends lately and we make movies on our own money. I’ve worked on movies that turned out better than some that get into theaters and what are they planning on? A live-action “Tom and Jerry” movie, which will no doubt cost Warner Bros at least $70 million to make.
My friends and I have better ideas for feature films and we know we can make them for a fraction of the price. If Hollywood wants to make it through this economic slump, they’re going to have to make movies at a more affordable price. They can cut down on star actor’s payrolls that take up 50% of the movie’s budget if that helps and the directors as well. AND they can make their movies better. Why not go back to making more “safe movies?” I’ve got a few ideas myself that could fly. Wanna hear’em, Hollywood? Hook me up and we’ll talk business.
With even Hollywood facing an economic slump, the Senate Finance Committee's $275 billion tax title of the economic stimulus package would lend a hand to movie studios that have seen outside financing dry up.
Well perhaps they could cut some losses by, yunno, making better films for less. It’s already been announced that this provision has been stripped from the bailout. Oh sorry, I meant “stimulus package.” Who was supporting this anyway?
The Senate bill includes a tax break worth up to $246 million over 11 years for investors in bigger-budget movie projects that don't necessarily qualify for incentives currently. The provision is backed by firms like the Walt Disney Co., and the industry trade group the Motion Picture Association of America, according to aides and lobbyists.
The Walt Disney Company? The happiest place on Earth wants a piece of the pie? Sorry boys, I love you, but before you even consider asking for not-so-free money, you might want to consider apologizing for “The Shaggy Dog” remake.
Broadly speaking, the Senate bill includes a one-year extension through 2009 of a provision enabling companies to write off 50 percent of the cost of equipment placed in service during that year, same as in the House Ways and Means version. But the Senate bill amends the definition of "qualified property" to include "certain motion picture film or videotape," bringing the cost of the Senate provision to $5.32 billion, up from the House's $5.07 billion version.
Companies that use the tax break would then forfeit the right to use the existing incentive, which allows companies to deduct 100 percent of production costs up to $15 million. That provision is backed by groups such as the Directors Guild of America and is aimed at keeping smaller productions from relocating to foreign countries; it was extended as part of the $700 billion financial rescue plan in October.
But a problem arises for pictures that cost $30 million or more, which the option to instead use bonus depreciation attempts to resolve.
It probably wouldn't benefit blockbusters that take years to produce, a lobbyist said, given that, to benefit, a firm's asset must be placed in service -- hitting the theaters or video market -- during that time.
Oh, the agony. Look, I know that life must be hard producing movies for the price that most small companies don’t earn in a year, but you can do well for much less. I’ve been talking with my friends lately and we make movies on our own money. I’ve worked on movies that turned out better than some that get into theaters and what are they planning on? A live-action “Tom and Jerry” movie, which will no doubt cost Warner Bros at least $70 million to make.
My friends and I have better ideas for feature films and we know we can make them for a fraction of the price. If Hollywood wants to make it through this economic slump, they’re going to have to make movies at a more affordable price. They can cut down on star actor’s payrolls that take up 50% of the movie’s budget if that helps and the directors as well. AND they can make their movies better. Why not go back to making more “safe movies?” I’ve got a few ideas myself that could fly. Wanna hear’em, Hollywood? Hook me up and we’ll talk business.
posted by Jaimetud at 7:45 PM
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