Massachusetts Taxpayers Fund Major Film on Climate Change

Recent state revenue data reveals that Massachusetts taxpayers played a significant role in financing the Hollywood movie Don't Look Up, which focuses on climate change. This dark comedy, released on Netflix in December 2021, tells the story of a group of scientists who discover that an asteroid is on a collision course with Earth, but struggle to convince society to take their warnings seriously.

The film, which features stars Leonardo DiCaprio and Jennifer Lawrence, had a production budget between $75 million and $100 million. Although it grossed less than $800,000 at the box office, its viewership numbers soared, with audiences watching it for over 263 million hours shortly after its release.

Interestingly, more than half of the film’s production budget came from Massachusetts taxpayers through a state film tax credit program. The program offers a 25% credit on production expenses for films shot in the state. If the credits exceed the tax liability, productions can get refunds, and there’s no cap on the credit, allowing companies to transfer these credits to others.

This month, the Massachusetts Department of Revenue disclosed that out of the $73.3 million spent on film tax credits in 2021, a staggering $46.3 million went to Don’t Look Up. This means Massachusetts taxpayers essentially covered 84% of the stars’ salaries, contributing significantly to the film’s overall budget.

Supporters, including House Speaker Ronald Mariano, argue that such incentives generate local jobs and stimulate the economy. Mariano remarked that movie productions bring economic activity, claiming they spend money widely in local businesses.

However, evidence suggests that the tax credits may not yield the expected economic benefits. A report by the Tax Expenditure Review Commission found that, despite immediate spending within the Massachusetts economy, the film credit hasn’t significantly boosted long-term growth, resulting in costs of $100,000 for each job created.

The scenario is similar in other states. A study in Georgia revealed that the film credit program cost the state $160,000 for every job produced. In New York, a December 2023 audit noted that the film production tax credits were likely a net cost, with a return on investment of merely 31 cents on the dollar.

Don’t Look Up is directed by Adam McKay, known for his satirical storytelling. As he reflects on the public policy shortcomings in his film, it may be interesting to see what issues he tackles next.