During a recent charity event in Toronto in early December,
2012, well known Hollywood actor and producer, Mark Wahlberg made a
public plea to the Canadian government to "reinstate"
film subsidies for U.S. originated film and TV productions filming
in Canada. In an interview with the national Globe and Mail
newspaper, Mr. Wahlberg made the following comments:
"We are really trying to encourage the government to
reinstate these tax incentives to bring film and cinema back to
Canada. I've made four movies in Toronto and three in
Vancouver. It's the best working experience, some of the best
crew, the best people I've ever worked with, and there is just
not enough film being made here.... it was some of the best work
experience that I've had. And it's just a shame that films
are going to other places."
Mr. Wahlberg is a very gifted actor as well as a talented
producer who is extremely popular with Canadians. However, his
comments were quite perplexing to the Canadian film industry (and
the Canadian government was not amused) because federal Canadian
film tax credits have actually never been reduced since their
introduction in the mid-1990s and film production activity has
actually been on the rise in Canada in recent years.
The facts are as follows:
1. The Canadian Income Tax Act has two available
alternative film tax credits, namely, (a) the Canadian Film or
Video Production Tax Credit (the "CPTC")
which is only available to Canadian controlled producers and, (b)
the Canadian Film or Video Production Services Tax Credit (the
"PSTC") which is available to both
Canadian and non- Canadian controlled film producers including
2. The CPTC was introduced by the Canadian government in 1995
and is equal to 25% of qualified Canadian labour costs
"capped" at 48% of the production cost so that the CPTC
cannot exceed 12% of the production cost (ie. 25% of 48%). In 2003,
the CPTC was made more generous by the Canadian government when it
increased the 48% production cost cap to 60%, so that now the
maximum CPTC is 15% of the production cost (ie. 25% x 60%);
3. The PSTC was introduced by the Canadian government in 1997
and was originally set at the rate of 11% of qualified Canadian
labour costs with no "cap". However, in 2003, the
Canadian government raised the PSTC rate by 5% to its present rate
of 16% of qualified Canadian labour costs; and
4. In recent years, total film production activity in Canada has
increased, not decreased. For example, in 2011 the total volume of
film and TV production in Canada reached an all time high of
CDN$5.5 billion. Similarly, in the Province of Ontario, total
production reached a record CDN$1.262 billion in 2011 and in 2012
it is on track to at least match this record production total.
We Canadians loved Mr. Wahlberg in The Fighter. We
laughed at him in Ted and when he talked to animals on
Saturday Night Live. We enjoyed watching
Entourage which he produced. However, as much as we are
big fans of Mr. Wahlberg up here in the Great White North,
unfortunately neither his undeniable talent as an actor, nor his
keen business acumen as a producer, translates into comparable
expertise in the (far more mundane) area of Canadian film
Anyway, no hard feelings Mark, thanks for all the compliments
and we hope that our generous, stable and bankable Canadian film
tax credits will cause you and your Hollywood friends to come and
visit us again soon!
The content of this article does not constitute legal advice
and should not be relied on in that way. Specific advice should be
sought about your specific circumstances.
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