Morristown, December 9, 2024 – The Garden State Initiative (GSI) has released a report authored by Dr. Charles Steindel, titled “New Jersey’s Film Tax Subsidy: Is it Worth it?”. The report argues that the film tax credit subsidies in New Jersey will not generate enough economic growth to cover their costs.
Dr. Steindel, who has held positions such as Resident Scholar at Ramapo College's Anisfield School of Business and Chief Economist at the New Jersey Department of the Treasury, stated there is no evidence supporting the continuation or expansion of New Jersey’s film and video production credit program. He noted, "Under the Murphy Administration, New Jersey has greatly expanded subsidies for film and video production, yet scant evidence exists that these subsidies generate any growth at all, let alone enough to cover their cost."
The report criticizes support for the film industry based on analyses with seemingly impressive numbers but fails to mention that New Jersey's annual economic activity is around $800 billion. In contrast, wages earned by workers in film and video production in 2023 were just over $300 million.
New Jersey offers transferable corporate tax credits to the film industry, starting with 30% of production costs outside of New York City and 35% elsewhere in the state. This comes with an annual limit of $430 million allocated through the state’s Economic Development Authority (EDA). A similar program faces criticism in New York State.
"This report aligns with similar research in other states confirming the limited value in film tax credits for New Jersey taxpayers," said GSI President Audrey Lane. "Given New Jersey’s current economic and fiscal challenges, the decision to expand these Hollywood tax credits is perplexing."
Former NJ State Treasurer Andrew Sidamon-Eristoff added his perspective: “Thank you, Dr. Steindel and GSI, for once again documenting the unvarnished, if unwelcome truth: film and production tax credits are great politics but lousy economic development policy. New Jersey’s taxpayers deserve better.”
