What are the budgetary consequences of film tax credits?
Vermont is one of the few states that does not have a balanced budget requirement, thus most states must balance their budgets, and often evaluate tax credits in the context of an economic scale - suggesting that they must pay for themselves. Thus most states want to evaluate whether film tax credits produce enough total economic growth resulting in new tax revenues in the state to offset the reduction in taxes collected by the state from the tax credits offered to incentivize the film industry. The Iowa Film Tax Credit is projected to produce a net increase in tax receipts to the state as cash film expenditures create a money multiplier within the economy resulting in a net increase in tax revenues to the state as the film industry grows and develops.