Letters: A race to the bottom on taxes

Wilbur Fitzgerald, left, and partner Ric Reitz are part of an expanding web of brokers, tax attorneys, financial planners and consultants who help filmmakers exploit the patchwork of state programs to attract film and TV production.

Dec. 29, 2013 12 AM PT

Re “Making film deals with tax credits,” Dec. 26

When a small Caribbean nation offers itself as a tax haven to a foreign corporation, it is not hard to see what is going on. The haven country is bribing the multinational, and the multinational is soliciting the bribe. Tax havens even compete to offer the best terms in the form of the lowest taxes. This sets off a race to the bottom in tax rates.

One would hope for better at home, but here states compete by bribing filmmakers with tax credits. Filmmakers solicit deals from the states and pin the states against one another in bidding up these credit deals. This erodes the tax base. Tragically, the states are even more misguided than those Caribbean nations, because those countries at least make money from their incentive programs, while states are competing for the right to lose the most tax money.

What is needed is a multi-state tax compact. Perhaps the U.S. government can broker one — right after it finishes negotiations in the Middle East.

Jonathan D. Kaufelt

Santa Monica

ALSO:

Letters: What real humility looks like

Letters: A race to the bottom on taxes

Letters: Being wealthy isn’t a sin, but ...