Unlikely as it seems, reality show star Snooki of “Jersey Shore” has found herself at the center of two important tax policy debates. The first was last year when Snooki criticized President Barack Obama for the 10% tanning tax contained in the healthcare reform bill. Now there’s a controversial tax credit in her name – the Snooki Subsidy.
The producers of “Jersey Shore” had been eligible for the Snooki Subsidy as part of a film tax credit program for filming in the Garden State in 2009. The program, however, was suspended in 2010 by Governor Chris Christie as part of the effort to close the state’s budget deficit.
Putting aside the merits of the “Jersey Shore” itself, film and television tax credits are a poor use of taxpayer money, a view shared by tax policy experts across the political spectrum. As the Center on Budget and Policy Priorities explains, such subsidies reward companies for production they would have done anyway, rarely create jobs, and could be redirected toward more productive purposes. In fact, the Massachusetts Department of Revenue conducted the most thorough study on film subsidies and found that every dollar of state revenue spent this way generated only 69 cents in income for Massachusetts residents.
New Jersey is not alone in having supported economically inefficient and politically embarrassing film and television tax incentives. The Tax Foundation found that 40 states offered $1.4 billion in such credits in 2010 alone, and some $6 billion in the last decade.
The non-partisan think tank, New Jersey Policy Perspective, notes that the outcry over the Jersey Shore subsidy is somewhat ironic considering the relative silence about a far more ludicrous $82 million subsidy given to Pearson, Inc., simply to move its jobs from one New Jersey city to another.
Subsidy in hand, Pearson now plans to move one third of its existing workforce to New York City and pick up another subsidy there.
The no-longer-potential-president Christie was wise to gut the film tax credit, but someone should be throwing a Snooki tantrum over the Pearson giveaway.