Doubling film tax credit 'sign of confidence' in growth, industry association says

The doubling of a tax credit for Manitoba filmmakers is a "sign of confidence" in the growth of the industry, according to the province's media production association.

In the provincial budget released Thursday, the film and video production tax credit increased to $31.5 million, up from $16 million in the previous budget.

"The announcement really just shows that the government is planning forward for continued growth of the industry," said Nicole Matiation, executive director of On Screen Manitoba.

The tax credit, originally created in 1997, provides a 30 per cent credit on all production spending in Manitoba, or between 45 and 65 per cent for eligible labour costs. It had been set to expire this year, but in January the province announced it would make the tax credit permanent.

The province hired consulting firm KPMG to review the credit in 2017. That review found Manitoba's tax credit was among the most generous in Canada and recommended reducing it in line with other western provinces, but the Manitoba government clearly went in the opposite direction.

Film production spending has increased steadily over the last few years, Matiation said. For years, total annual spending hovered around $108 million, but that jumped to around $140 million in 2016. Last year, film productions pumped $160 million into the provincial economy.

"So that initial investment of the tax credit is really generating a huge return, in terms of investment coming into Manitoba, and then also it's generating jobs. It's a really effective tool," said Matiation.

Provincial film agency under review

Manitoba Film and Music, the provincial body that administers the tax credit, estimates production spending in 2019 to grow to $250 million, Matiation said.

In December, the province announced it was looking for a contractor to review Mantioba Film and Music.The agency's funding was reduced from $3.87 million in 2017 to $3.58 million in 2018, an annual report from the organization said.

The consultant reviewing Manitoba Film and Music will be asked to identify the mandate and objectives of the organization and evaluate its effectiveness.

As the volume of film and video production in Manitoba continues to grow, demand for the tax credit will increase as well, making the increased funding even more necessary, Matiation said.

"In Canada the media production industry works through government investment," she said. "Those are really the tools that can attract the investment from other places, other countries, or other levels of government that make it possible for the industry to flourish the way it is today in Canada."