Could HST referendum in B.C. give Ontario back its Hollywood North crown?

·National Affairs Contributor

It'll be another 18 months or so before British Columbia's harmonized sales tax is replaced by the old-school GST and provincial sales tax combo after voters killed the HST in a referendum.

But Vancouver's film and TV sector is already wringing its hands over the potential affect on the $1-billion industry.

A story in the Hollywood Reporter in the wake of the vote result probably did nothing to quiet the anxiety.

The trade paper's Toronto correspondent Elan Viessing reported Ontario could be the beneficiary when the B.C. HST is phased out.

The province instituted the harmonized tax in 2010 at the same time as British Columbia. But with no referendum legislation, Ontario opponents had no way of challenging it.

Ontario Premier Dalton McGuinty was quick to gloat on Twitter last week the business-friendly HST would give Ontario a competitive advantage.

B.C. and Ontario are perennial Hollywood North rivals for film and TV production but the West Coast has been winning in recent years. It ranks third behind Los Angeles and New York in North American film and TV production.

Each province has offered the industry generous tax credits, which help offset the disadvantage of a rising Canadian dollar. But B.C. still gets the lion's share of Hollywood-based projects, last year worth almost $780 million.

It includes upcoming movies like The Company You Keep starring Robert Redford and Shia Labeouf and TV series such as Fringe and Psych.

The Hollywood Reporter noted U.S. foreign location shooting rebounded in Ontario last year after the province introduced a 25-per cent tax credit covering all expenditures. B.C. quickly responded by boosting the value of its foreign-film tax credit.

Local industry officials have kept a low profile since the referendum results were announced last week. Public reaction has been mixed.

The pro-HST crowd worried the cost-sensitive business will up stakes while the tax's opponents say Vancouver will keep its advantage if only because it's a three-hour plane ride from L.A. and in the same time zone.

But the Hollywood Reporter speculated at least some of that attraction may diminish if the PST increases production costs.

(CP Photo)

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