SACRAMENTO, California A California bill
proposing a 25 percent tax on revenues from adult entertainment
would do little to ease the state's budget shortfall and would
cost the state money by encouraging its pornography industry to
move, opponents said on Monday as lawmakers reviewed the bill.
The legislation would especially hurt the economy of the
San Fernando Valley, the Hollywood of pornographic filmmaking,
said opponents, who included several dancers and other adult
entertainment performers and employees at a hearing on the bill
in the state capital, Sacramento.
"This will decimate the San Fernando Valley," Larry Kaplan,
executive director of the California branch of the Association
of Club Executives, a group representing adult entertainment
clubs, told Reuters.
"We estimate it would take $3.5 billion out of California,"
Kaplan added, referring to the economic activity the state
could lose if it were to tax strip-club performances, porn-shop
sales and adult Web site revenues at a 25 percent rate.
Matt Gray, a lobbyist for the state's adult entertainment
industry, echoed the familiar refrain of mainstream small and
big businesses directed at lawmakers who propose raising
business taxes: "It's an unfriendly business climate here."
If porn-film production costs are pushed up, California's
adult movie-makers will have even more reason to shoot movies
elsewhere, Gray said, adding that Budapest is giving the San
Fernando Valley, north of Los Angeles, a run for porn-film
"It's actually cheaper to fly everyone to Budapest to do
their shoots there and to fly them back," Gray said.
FINANCIAL, SOCIAL FIX
Assemblyman Charles Calderon had proposed his bill to help
raise revenues for the cash-strapped state. Gov. Arnold
Schwarzenegger has forecast a $20 billion budget shortfall.
But additional tax revenues from the adult entertainment
activity would also help defray social costs associated with
it, including crime, drug abuse and sexually transmitted
diseases, according to Calderon, the Democratic chairman of the
chamber's committee on revenues and taxation.
"This tax would cover the gamut of adult entertainment," he
told fellow lawmakers. His bill would tax production,
distribution, retail sales, Internet downloads and performances
of adult entertainment.
"Every second, $3,000 is being spent on adult
entertainment," Calderon said. "Every 39 minutes, a new adult
video is being made in the United States."
Former porn actress Shelley Lubben spoke in favor of
Calderon's bill, detailing to lawmakers her history of
prostitution, drug abuse and sexually transmitted disease while
in the industry.
"I really don't think the state understands the problem,"
Lubben said. "It literally took me eight years to recover."
(Editing by Gary Hill)