Hugo Weaving (L), director Peter Jackson (C) and Ian
McKellen are seen on the set of 'The Hobbit: An Unexpected
Journey'. Photo MCT
A majority of New Zealanders polled by the New Zealand
Herald back the $67 million in tax breaks given to the
producers of The Hobbit by the Government - but only if the
films return more than that to the local economy.
Only one in five people surveyed in a Herald-DigiPoll poll
completely opposed the subsidies given to Hollywood studio
Warner Brothers for the making of The Hobbit films.
The poll showed New Zealanders were not highly concerned
about the principle of giving tax incentives to an overseas
company, but they would be concerned if the costs of this
subsidy were not recovered.
Asked which statement best fitted their view on the taxpayer
subsidies for The Hobbit, 65 per cent of respondents chose
"It was worth it only if the New Zealand economy gets more
than that amount back".
Economic Development Minister Steven Joyce said the poll
showed that New Zealanders understood the value of the films
to the economy.
"We have been confident all the way through that these movies
would be good for New Zealand and ... certainly the box
office internationally over the last few weeks has underlined
The first film in the trilogy, The Hobbit: An Unexpected
Journey, has earned US$959 million ($1.15 billion) worldwide,
a third of this in the United States where it was showing in
It was no longer the most popular film in the US, but it
remained at the top of the New Zealand box office, where it
had earned $8.3 million in its first three weeks.
Mr Joyce said he believed tax breaks would be easily eclipsed
by increased income taxes generated by the movies and the
greatest benefits would come from indirect sources such as
The National-led Government controversially changed
employment laws and granted tax breaks amounting to $67
million to Warners in 2010 after director Sir Peter Jackson
warned The Hobbit franchise could be moved to countries where
it was cheaper to film.
Labour Party spokeswoman for labour issues Darien Fenton said
her party supported the tax breaks but not the changes to
employment law. But she questioned why the Government was
prepared to single out the film industry for incentives as
opposed to other sectors which could provide highly-paid,
skilled jobs, such as manufacturing.
Prime Minister John Key has defended the deal with Warners,
pointing to the employment of 3000 people during the filming
and the $100 million spent by the studio on marketing the
ANZ-National predicted that if The Hobbit films had been
moved to another country, it would have led to $1.5 billion
in lost revenue from potential jobs, sub-contracting
positions, and local supply of goods and services.
Nearly 15 per cent of those polled said it was worth giving
tax incentives to film-makers even if the subsidy was greater
than the amount of wages and taxes paid in New Zealand.
- Isaac Davison of the New Zealand Herald