Horror Movies and Legislative Research, Together At Last!

A legislative research rabbit hole featuring tax incentives, public film financing and David Cronenberg.

While working through a legislative research question for a patron, I came across a parliamentary question in the House of Commons Debates, 30th Parliament, 1st Session, vol. 11, (1976) p. 10967 about a publication with the title: Is There a Place for Horror Films in Canada’s Film Industry?

The publication turned out to be a defence of David Cronenberg’s controversial 1975 film Shivers, then known as The Parasite Murders. Produced by Cinépix and circulated for reaction, the pamphlet brought together commentary both for and against the film and asked readers to consider whether horror had a place in Canada’s developing film industry.

I had descended into a legislative research rabbit hole involving David Cronenberg, public film financing, parliamentary debates and Canada’s “tax shelter” era of filmmaking.

What started with a horror-film pamphlet soon led to historical Income Tax Regulations, the Canada Gazette and a much larger question about the kind of film industry Canada was trying to create.

The pamphlet: a defence of Shivers

The pamphlet presents The Parasite Murders as its “case in point.” Produced in response to criticism of the Canadian Film Development Corporation’s investment in the film, it argued that building a viable Canadian film industry required commercially successful genre films as well as prestige productions.

At its heart was a larger question about public investment and cultural policy: should the Corporation act as a cultural gatekeeper, or help build an industry capable of supporting different kinds of films?

The surviving package also includes responses from politicians and film-classification officials, suggesting Cinépix circulated it looking for reactions.

Where do the tax shelters come in?

During my reading, I kept coming across references to the 100% Capital Cost Allowance (CCA) for “certified Canadian feature” films during Canada’s so-called “tax shelter” era.

The 100% CCA allowed private investors to deduct the full cost of qualifying Canadian film investments from taxable income. [1]

The incentive was associated with a dramatic expansion in Canadian filmmaking during the period, and genre films, horror in particular, found especially fertile ground. The Canadian Encyclopedia, for example, describes feature-film production increasing from 3 films in 1974 to 77 in 1979.[2]

Interesting enough. But for a legislative researcher, a statement in a secondary source is just an invitation to ask another question: where is the law?

The current Income Tax Regulations, Part XI, Capital Cost Allowances, subsection 1104(2), refers to films for which production activity commenced after November 18, 1974. That gave me a useful  date for tracing the regulatory history.

November 18, 1974 seemed promising! That was the date of Finance Minister John Turner’s November 1974 budget speech.[3] Except, as I perused the ever-compelling budget speech (and subsequent budget bill), I found that while Capital Cost Allowance was mentioned, there was nothing about its application to films. Back to the regulations.

The change affecting certified feature films was made through Class 12 of the Capital Cost Allowance provisions and can be traced through SOR/75-462 in the Canada Gazette.[4]

This is exactly the kind of detour that makes historical legislative research so useful. You start with a date, expect to find the answer in a budget, get sent back into historical regulations and, before long, you’re searching old issues of the Canada Gazette. Somehow, we always end up here.

But what did Parliament have to say about all this?

This is where things get a little chaotic, appropriately enough for a Halloween post.

The 1970s and early 1980s were a messy period for Canadian film policy, with tax incentives, private investment, public financing and arguments over what Canada’s film industry should look like all swirling around at once. And because regulatory changes don’t leave the same parliamentary trail as a bill, there was no single debate that neatly explained it all.

The research became its own scavenger hunt through the Canada Gazette, historical regulations, Hansard indices, government reports and contemporary commentary. “Capital Cost Allowance” was only one route in.

I’ve barely scratched the surface here, but for an October research rabbit hole, the trail seemed too good not to share.

What began with an unexpectedly titled pamphlet had led to the Income Tax Regulations, the Canada Gazette, Capital Cost Allowance and a much broader debate about Canadian film and cultural policy.

And the rabbit hole goes much deeper. Andrew J. Duffus’s 1977 thesis, Private Motion Picture Investment and the Income Tax Incentives in Canada, continues the trail through a review of Orders in Council, Revenue Canada interpretation bulletins, tax rulings and cases involving motion-picture investments.

Sometimes legislative history is less about finding one definitive debate or answer and more about following the breadcrumb wherever it leads.

Don’t be afraid of legislative research

The Great Library’s CPD-accredited Legislative and Regulations Research Refresher sessions revisit the building blocks of legislative research and the techniques that can help when the answer isn’t sitting conveniently in the current consolidation.

Sometimes following the legislative trail leads to Hansard. Sometimes it leads to reading about horror movies. And sometimes, if you’re very lucky, it leads to both.

---

Further reading

Canadian Film and Videotape Certification Office, Canadian Film and Videotape Certification Office: Statistical Bulletin 1974–1983, (Government of Canada, Department of Communications, 1985).

Cinépix, “Is There a Place for Horror Films in Canada’s Film Industry?” (Cinépix archival PDF).

Gina Freitag & André Loiselle, eds, The Canadian Horror Film: Terror of the Soul (Toronto: University of Toronto Press, 2015).

Peter Urquhart, “1979: Reading the Tax-Shelter Boom in Canadian Film History” (2004, McGill Scholaris).

Andrew J Duffus, Private Motion Picture Investment and the Income Tax Incentives in Canada (Vancouver: University of British Columbia, 1977).

David Ellis, An Assessment of Measures to Stimulate Growth of the Domestic Program Production Industry for Television, with Respect to the Federal Broadcasting Objectives and a Comprehensive Policy for Canadian Television, report prepared for the Broadcasting Policy Division, Department of Communications, (Ottawa : Department of Communications, 1979).

---

[1] Peter Morris, Andrew McIntosh “Capital Cost Allowance/The Tax Shelter Years: 1975 to 1982” Canadian Film Encyclopedia, and, Canadian Film and Videotape Certification Office: Statistical Bulletin 1974–1983 (Ottawa: Department of Communications, 1985).

[2] Ted Magder, Piers Handling, Andrew McIntosh “Tax Shelter Films” (2017) The Canadian Encyclopedia.

[3] And no, this isn’t something I just knew. I Wikipedia’d the date. For those readers who love this type of hard-won detail, here are the exact search terms: “November 18, 1974” Canada Wikipedia.

[4] This change represents only one part of the broader regulatory puzzle.