A rather odd choice in a political attack vector from the Green Party in New Zealand (think far left liberals if in the US) revealed that Warner Bros received back $200 million in benefits from the government for filming The Hobbit trilogy in the country whose total production cost was $1.1 billion. Green Party spokeswoman Julie Anne Genter said the grant was "pretty extreme" saying "...our Government should [not] be handing out hundreds of millions of dollars to film companies that are making billions of dollars."
It should be noted that governments handing out incentives to keep a business (or film company) in a certain locality is a common practice around the world. While the conservative parties around the world prefer to give tax incentives away and just hope the recipients do the right thing, true incentives are supposed to have a carrot approach of "we give you X dollars back if you do Y things." In this case New Zealand promised around a 20% back on the cost of production in return for WB filming the entire trilogy in the country and participating in various ads to promote New Zealand tourism (hence those supplementals in the home video releases).
In this case the size of the grants were the result of months of negotiations when a mini-bidding war for The Hobbit production erupted between New Zealand and England when Warner Bros. signaled it was seriously considering moving production the England to save money via such incentive programs. It took a literal act of New Zealand's congress to get the production to stay. The Lord of the Rings trilogy proved to be a significant boom to the tourist industry of New Zealand so they already had first hand knowledge of how important a new trilogy could be.
From a practical point of view the Green Party's rather idiotic argument seems to be that the New Zealand government should have said no to around $900 million being spent in the country by refusing any incentives including risk increased tourism competition from movie fans who would then have a choice between the England or New Zealand for their Hobbit fix. By any measure the choice between $0 or $900 million at the cost of $200 million seems like a no brainer. Unless your the Green Party which speaks poorly of what would be their fiscal management for the country. (via TOR)