New Mexico Senate OKs $50-million cap on film tax rebates
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New Mexico’s film tax program, one of the most successful in the country, may not end up on the cutting-room floor after all.
The state Senate voted Wednesday to approve a measure that would preserve the state’s 25% film tax subsidy on qualified film and TV expenditures but cap the total amount of funds paid out annually at $50 million a year.
The bill marks a compromise and partial victory for film-industry advocates, who reacted angrily to a recent proposal by Republican Gov. Susana Martinez to drastically scale back the tax rebate to 15% from 25%. Critics said that would devastate New Mexico’s vibrant film industry, causing producers to take their business elsewhere.
Still, the measure would mark a reduction in the state’s current program, which awards about $65 million a year but has no annual cap. The measure passed on a 30-10 vote and this week will go back to the state House, which had approved a $45-million cap. Martinez has said she would veto any bill with a cap higher than $45 million.
New Mexico is the latest among several states, including Michigan, that have been weighing significant rollbacks in their film subsidies as they confront massive budget deficits and new governors who face pressure to slash spending.
With its 25% film tax credit and diverse locations, New Mexico has hosted such high-profile Hollywood productions as “Terminator Salvation” and recently secured Marvel Studios’ “The Avengers,” which is scheduled to begin filming next month in Albuquerque.
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