Illinois Governor Signs New Film Tax Breaks Legislation

by Leroy Baker, Tax-News.com, New York

21 August 2003

Illinois Governor Rod Blagojevich this week signed into law a package of tax breaks designed to lure movie and television companies back to the state following years of decline in the number of productions taking place there.

Many states across the US have suffered at the hands of 'runaway productions', whereby producers of big-budget movies have chosen to locate in countries with favourable tax regimes for such projects, such as Australia and Canada. "In the old days, movies were filmed in Illinois all of the time," Blagojevich lamented recently. "Nowadays, movies named 'Chicago' are filmed in Toronto."

Illustrating the extent to which runaway production has affected states like Illinois, Brenda Sexton of the Illinois Film Office estimated recently that the state has forgone about $100 million per year in film and television production revenue in recent years. Blagojevich also points out that since 2001, 18 movies which were 'set' in Chicago were actually shot on location in Canada.

Meanwhile, Bob Teitel and George Tillman, producers of Barbershop and Barbershop 2 (the latter of which is being shot in Chicago) welcomed the move, although they warned that Canada in likely to remain very attractive to US film-makers.

"It's so competitive out there. It's so competitive in Canada, with the dollar. Anything that helps brings more productions here is a step in the right direction," Teitel told the Associated Press.

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