A lawsuit says Arizona’s new tax breaks for film production violate the Constitution’s “gift clause.”
PHOENIX — The Goldwater Institute has sued state officials to block new Arizona tax incentives for film production, claiming the credits violate the state constitution.
This week, a conservative think tank filed a lawsuit on behalf of two Arizona residents to have a court determine whether tax breaks for film projects violate Arizona’s “gift clause,” a constitutional rule that prohibits the government from handing over assets to private entities without the purpose of serving the public.
The Arizona Motion Picture Production Program was created in 2022 by House Bill 2156, which passed through the Arizona Legislature with support from Republicans and Democrats. The program is allowed to award up to $125 million in credits for qualifying film productions.
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Goldwater’s legal complaint says the film program does not provide “direct, measurable benefits” to the public.
“The provisions of the Arizona Motion Picture Production Program tax credit fail the public purpose requirements of the Gift Clause because they are intended exclusively for the primary benefit of private parties over whom the state exercise
“Inadequate oversight or oversight,” the lawsuit states.
Arizona has a rich filmmaking history dating back to when Westerns were filmed at Old Tucson Studios in southern Arizona, or when Elvis Presley filmed a movie in a chapel near the Superstition Mountains, or when Bill and Ted went on a “Super Adventure “Across the United States. Valley.
In the 2000s, the state created tax breaks for motion picture projects, but the incentives ended in 2010 amid the Great Recession. The Goldwater Institute says this previous tax program failed to produce enough benefits to prove its existence.
The plaintiffs are seeking a court injunction prohibiting state officials from granting tax breaks under the film program.
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*Editor’s Note: The above video is taken from a previous broadcast.*