Tax Cuts are not a ‘Public Enemy’

For the last several months, the buzz has been building around the filming of a movie about the infamous bank robber John Dillinger. The movie, "Public Enemies," directed by Wisconsin native Michael Mann and starring Johnny Depp, began filming earlier this year in Oshkosh and Columbus and hit the streets of Milwaukee this week.

On Tuesday, I was able to visit the set of the movie inside the refurbished Milwaukee Historical Museum on Old World Third Street. It was exciting to see the action up close and get a glimpse of what it takes to make a major motion picture.

While the filming was going on inside the building, outside was no less active. Nearly a dozen semi trucks crowded the street; crew members, cast and extras moved in and out of a roped off area in Pere Marquette Park, and dozens of people took the opportunity to share in the experience. The event had a true buzz about it.

I was told by a publicist for the film that the cast and crew have been very well received and we have shown the folks from Hollywood that we appreciate their business. We certainly appreciate the money they are spending all over Wisconsin, but why are they here and not Minnesota for example?

The answer is simple: Tax cuts.

It was no coincidence that location scouts for Public Enemies began scouring Wisconsin in January of this year. Why? Because Jan. 1, 2008, was the first day film production companies were able to receive tax credits for doing business here. The film industry tax credit legislation that I authored, known as Film Wisconsin, passed the Legislature with overwhelming bipartisan support in 2006, creating a brand new stream of revenue for our state.

Film Wisconsin provides a refundable tax credit of 25 percent on direct production expenditures and a 25 percent investment tax credit for investing in Wisconsin-based productions. In addition, production companies doing business in Wisconsin can get a 15 percent film production investment credit on expenditures for property and equipment.

Businesses need to make money to exist. Hollywood studios and production companies are no different. Passage of Film Wisconsin sent a clear message to those companies that we wanted them to come here and we were ready to compete for their business.

For too long, Wisconsin failed to compete for entertainment industry dollars, even though it’s one of our country’s largest export markets. For 20 years, we’ve referenced the same handful of films shot in Wisconsin like "The Blues Brothers" and "Major League." All the while, states like North Carolina, New Mexico, Louisiana and even Illinois cut taxes on film productions and made millions upon millions of dollars.

Without passage of Film Wisconsin, we would still be hoping that Hollywood would bring its money here instead of being proactive and grabbing our share. Tax cuts and tax credits work. They create jobs, they increase revenue, and they have the ability transform an old economy like Wisconsin’s into a modern, vibrant one.

When we cut taxes on film productions, films companies started doing business here. It’s a simple cause and effect relationship and the lesson can be applied to several different situations. If we cut taxes on wages, you would have more money in your pocket to save or spend. If we cut taxes on retirement benefits, our retirees think twice about leaving Wisconsin and flocking to Arizona or Florida. Cut taxes on businesses and they flourish putting more money back into the economy and hiring more employees, both of which are good for the overall growth of Wisconsin’s economy.

As a state, we have to learn from our experiences. Tax cuts should not be public enemy number one. They work and we need to keep cutting taxes to get our economy growing again.


State Sen. Ted Kanavas (R-Brookfield) represents the 33rd District in the Wisconsin State Senate.