Report: DiCaprio, Scorsese's 'Wolf' Cost NY Taxpayers $30 Million
It's the kind of money maneuver disgraced stock broker Jordan Belfort would applaud.
Martin Scorsese's The Wolf of Wall Street, nominated for five Academy Awards including Best Picture, got a cozy tax break from the state of New York where the movie was shot.f
Thanks to state law, The Wolf of Wall Street received a 30-percent tax credit from New York State, which means taxpayers paid for $30 million of the movie's $100 million budget, according to the Manhattan Institute, a nonprofit, nonpartisan economic research and policy group.
The film stars Leonardo DiCaprio as Belfort, a Wall Street hustler who made millions while ripping off ordinary Americans.
Wolf isn't the only Hollywood film to get such a tax break. Numerous Oscar-nominated films, including Dallas Buyers Club, Gravity and American Hustle received similar incentives.
It's routine for studios to seek out such deals and move their productions accordingly. It's why the new Mayor of Los Angeles, Eric Garcetti, is desperately trying to keep productions local despite the lure of tax breaks in places like Vancouver and New Mexico.
Politicians argue the tax breaks invigorate the local economy, but the right-leaning Manhattan Institute argues those benefits tend to be fleeting.
The Christian Science Monitor reports that Louisiana, one of the more generous states regarding film tax breaks, also doesn't see the return on investment promised.
Film production may create jobs in a given state, but they usually disappear by the time filming wraps up, marking only a blip in long-term employment efforts. The lure of a movie set and its stars may boost tourism, but that economic benefit is temporary too. Bigger specialized tax breaks also usually mean reduced revenue, which means "states have less money spend on teachers, roads and police," the Manhattan Institute report explains.
In 2010, Louisiana spent $196.8 million on film tax credits. But according to an analysis by the BaxStarr Consulting Group, film production generated just $27 million in state tax revenues and $17.3 million in local revenues.
The Tax Foundation notes the dramatic ups-and-downs of these state subsidies. In 2000, there were only three. By 2010, 40 states had adopted some form of tax break. But since that peak, nine states have abandoned these incentives.