Not long ago, my provincial government decided to do away with a program that created hundreds, if not thousands of jobs in the province, and which brought with it millions of dollars in revenue for the province. On the face of it, to much of the public, this move seemed like a really good idea. By way of a bit of background:
For the last several years (four, I think. Maybe five), the provincial government has provided the Saskatchewan Motion Picture Industry Association (SMPIA) with a refundable employment tax credit on labour costs incurred in Saskatchewan during the production of film projects. Basically, the way this worked was that the production company would hire people (in some cases, hundreds of people) to work on the crew, in make-up, costuming, set design and construction, lighting, sound…basically everything *except* acting (although acting might be included in that as well; I’m not certain). I don’t know how much you know about film/television production, but for every person you see on screen, there are about ten or eleven other people employed behind-the-scenes. So the production company would hire people in Saskatchewan to work on projects filmed in Saskatchewan (this is important).
This meant that there were, as I mentioned, hundreds, if not thousands of (primarily) young, passionate, capable people being offered jobs in a dynamic field that was the last in Canada to be supported in such a way. At the end of the project, the production company would file their financial records indicating how much was paid out in terms of labour costs, and a portion of that cost was refunded to them by the provincial government. Part of this program served as a mentorship and training program specifically for Saskatchewan people. In short, the Film Employment Tax Credit was a refundable credit provided by the Provincial government to make Saskatchewan competitive in the film industry, by providing incentives like this one, for businesses to conduct…well…business…in the province.
I want to be clear about something. Production companies only qualified to apply for this business incentive if they hired Saskatchewan residents. I believe eligible businesses also had to establish offices in Saskatchewan. So this means that in order to qualify for this incentive, production businesses must set up shop here, hire local people, and do work here. This also means people had to live here. Which means they paid taxes here. Which means that the amount of money coming *in* to the province was far, far more than the amount of money the government was spending on this business incentive.
Without any form of consultation, and a year before the contract between the film industry and the province was due to expire, the government elected to end this successful and lucrative (for Saskatchewan) program. This makes us the only province in all of Canada to have no incentives for film production businesses to do work in our province. Two other provinces in Canada have done away with similar programs, and within a few years recognised the detrimental effect it had, and ended up reinstating it. This leaves Saskatchewan as the only province in all of Canada (and, indeed in much of North America) that does not have a business incentive for employment in the film industry.
What does this mean? It means that our province is going to lose business. It’s going to lose trained, talented, passionate, energetic people to other provinces where they can find work. It means that our province will be losing several million dollars in revenue.
“Now hold on, cenobyte,” you’re saying. “Didn’t the provincial government just recently say that they’re replacing the Film Employment Tax Credit with a similar tax credit program?”
The new tax credit program will provide corporate tax subsidies or incentives for film production companies in the province. However, due to the nature of the new program, few if any production companies will qualify for it, and that means that the net result is a non-usable “incentive” that actually ends up being a DISincentive. If that’s a word. Which my spellcheck tells me it isn’t.
The new program offers a non-refundable reduction on a portion of corporate taxes production studios pay in Saskatchewan. Most production companies don’t actually pay enough corporate tax to take advantage of this reduction.
It’s like saying “we offer corporate tax deductions, but only if you already pay several hundred thousand dollars in corporate tax. If you’re a small or independent business owner, you will still pay the maximum amount of corporate tax for doing business in our province.” Kind of. That’s a gross oversimplification, and I don’t purport to understand the intricate working of tax legislation at all.
But essentially, the government took something that was working incredibly well and replaced it with something that simply isn’t workable. Such is the way of governments, perhaps.
And, to add insult to injury, our own Premier said, and this is not a direct quote, so please forgive me if I muck it up a bit, that if an industry is not viable without government subsidies, should the taxpayers continue to pay for it to operate in our province? And that is a very, very good question. It makes me wonder why the province is offering any kind of subsidies at all to any businesses. Including oil and gas, mining, agriculture, forestry, financial industries, insurance companies, tourism, and hospitality industries. All of those are subsidised in some way by our provincial government.
And the bottom line of all of this is that it makes me very sad, because the value that we, the taxpayers, receive from arts and culture, is immense. In very real terms, some of that value comes in the form of revenue and investment in our province, in our cities and towns. Some of it comes in the recognition we get, being able to compete on a world stage with similar endeavours from around the world. Some of that value comes in being able to live and work doing what you love to do, what you’ve studied to do, and what you’re good at doing. Arts and culture *create* jobs. Arts and culture *create* revenue. They also create communities where people want to live and work.
But now I’m getting in to the soapbox stage of things, and I oughtn’t do that, I think, because we’ve been on this merry-go-round before. So I’ll just say I’m looking forward to seeing some of the changes that are happening in our province, and I’m also very disappointed in what appear to me to be somewhat short-sighted decisions in other areas. There won’t be any minds changed on this, I’m afraid, and that just makes me a little…ashamed.