This article originally appeared in the Financial Post. Below is an excerpt from the article.
By Jack Mintz, May 16, 2025
Subsidies are in the news. Two in particular: film tax credits and EV support. It’s a sordid tale of doomed subsidy competitions among governments.
Film and movie subsidies have existed for over three decades. The blockbuster Minecraft, released April 4, had brought in US$409 million in ticket sales by May 19, almost 15 per cent of total North America sales over that period. On average in the past four decades, the top 1,000 movies have generated two to three times their production costs, a handsome return to the producers who own the intellectual property rights. Big money is clearly involved, especially for Hollywood producers.
Minecraft was filmed mainly in Calgary and Vancouver but also in Auckland, New Zealand. Why Canada and New Zealand rather than Hollywood? Labour costs and exchange rates are important. But location is also driven by subsidy competition. Governments fall all over themselves to attract film and video.
Our federal government provides two film and video credits, though only one can be claimed on any project: a refundable 16 per cent of production costs for both foreign and domestic producers or 25 per cent of labour costs for Canadian production (though only up to 60 per cent of production costs). In addition, all provinces provide their own tax credit or grant support for films, including 22 per cent of production costs in Alberta and 28 per cent of production costs or 35 per cent of labour costs in B.C. Together, federal and provincial support can easily cover over a third of production costs.
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Jack Mintz is the President’s Fellow at the University of Calgary’s school of public policy and a distinguished fellow at the Macdonald-Laurier Institute.
