Mayors of Canada’s largest cities got their opportunity to address the Senate committee yesterday regarding the proposed tax amendment, losing no time in informing them of the devastating impact Bill C-10 would have on their municipalities.
Toronto Mayor David Miller told the Senate banking committee, “This industry is of incredible importance,” and its artistic and financial success depends on its “continued ability to work in a field where the boundaries are well defined and political interference or censorship will not be tolerated.”
Miller added that production companies spent more than $700 million making movies and TV shows in Toronto in 2006 and the sector employs over 35,000 – more people than the number who work in manufacturing.
The amendment is buried in an omnibus bill, primarily intended to implement amendments to the Income Tax Act. It would give the Heritage Minister power to deny tax credits to television and film products deemed offensive or contrary to public policy even after government agencies have invested.
The industry argues it is unrealistic to suggest artists can make whatever film they want using private funding since virtually all programming in Canada requires some public cash. In addition, it would be very difficult, if not impossible, to convince banks to invest in a project if the credits could be withheld.
Miller agrees. “Canadian films are financed and made often on very tight budgets directly dependent on the tax credit that’s been carefully designed to support Canadian productions,” he said. “No financier is going to take the risk that their loans will not be repaid because of an after-the-fact cancellation of the tax credit. The storm of uncertainty stirred up by Bill C-10 would effectively end the film industry overnight.”
Montreal Mayor Gerald Tremblay told the committee the film industry has been active in his city for 60 years and is presently worth $1.3 billion annually to his province.
“Having read the bill, we feel obliged to state that the measures relating to tax incentives introduce an element of uncertainty which would have a negative financial impact on the production of Canadian and Quebec film,” Tremblay said.
Mayor Sam Sullivan of Vancouver, whose city ranks third only to Los Angeles and New York as North America’s busiest filming centre, sent a letter to the committee stating his opposition to the amendment and support of the actions of his fellow mayors.
In addition, Miller read a statement by Halifax Mayor Peter Kelly, adding his voice to the resistance.
“Had these proposed changes existed in the past, much of the uniquely Canadian art of which we are so proud, simply would not have made it to our screens,” Kelly wrote. He cited television shows like Trailer Park Boys and This Hour Has 22 Minutes as examples of productions that the government may have deemed contrary to public policy.
“My main concerns,” Kelly wrote, “are that these changes will cause enough uncertainty to negatively affect financing for film productions and that they could lead to an era of censorship that would devastate the industry and the creativity found within it.”
Both Miller and Tremblay said the government should draw up new, separate legislation if it wants to change the standards instead of placing it inside an omnibus tax bill like C-10.
Tremblay said, “…if you want to question the Criminal Code or you want to question Telefilm Canada, then let’s talk about that.”
Although Heritage Minister Josée Verner has promised a one-year grace period to consult with the industry and develop more precise guidelines, Miller said, “I don’t think it should be done through a mechanism like this, which if there isn’t consensus, the minister can basically do what she wants after a year.”
The Big City Mayors’ Caucus of the Federation of Canadian Municipalities has passed a resolution asking the federal government to eliminate the provision from the income-tax bill.
“We share a concern. That concern is about our economy,” said Miller. “But it is also about Canadians’ continued ability to tell our own stories to each other without fear of artistic and financial humiliation.”