Go check out Mack Weldon and get 20% off by using the link: mackweldon.com/brainfood20 and the promo code brainfood20 Thanks for supporting this channel. :-)
When it coms to this Mack Weldon, how does it compare to M&S, oh English Guru Hipster man? Also so they just do skinny hipster sizes or can they cope with meaty blubbery men shaped dudes?
Not really tax evasion, because somewhere along the line those taxes are being paid. But as mentioned in the video, anyone getting paid based on net profit is getting shafted - and Hollywood studios are more than happy to write deals like that up.
@@rodh1404 You said "somewhere along the line taxes are getting paid". Are you sure about that? I know lots of film production left Hollywood because other states started offering tax credits and tax rebate deals to get the film companies to shoot in those states. I think Georgia won the race to the bottom, and some stuff is shot in Canada and Prague to avoid paying any taxes. So I'm not buying your claim
That's libel sir. Tax evasion requires one to break or ignore tax laws. What they're doing is tax avoidance which is doing every possible thing allowed by law to minimize your tax burden.
@@stevechance150 As Christopher Woodbury said, tax minimization isn't the same as tax evasion. I do agree that at the level it's done by many big businesses, it's extremely dodgy, but still legal.
That's because, as they so clearly demonstrating with losing 40% to an "easily replaceable" actor, they don't just want to make some of the money, they want to make ALL of the money, legitimately or not
and the same rich that tell americans do more and do better. but then they lose their shit when mel gibson notes who almost exclusively runs hollywood and points out how fucking greedy ass two faced they all are. the horror.
Warner Brothers: We made 1 Billion dollars on this film. Irish Warner Brothers Pencil Company: We charge 1 billion dollars per pencil rental. Warner Brothers: oops, we made no money on that film, oh well.
And if anyone else tried to pull this they'll get told: "I'm sorry, those loopholes are only for those in the loop." And now you know how movie companies and even major corporations pay absolutely nothing in taxes year after year after year. But if you're even so much as late paying your taxes, they'll eviscerate you without hesitation. Why do they attack average people and not the companies? Well, companies like these can pay lawyers tons of money giving them teeth that the IRS isn't willing to fight with, which can get rather costly for the IRS. This is why the average tax payer gets the shaft and there's little they can do about it.
I remember in the 90s Paramount kept saying they were losing money on the Star Trek franchise. Then they got a new leader. She made it very clear that past statements were lies. She reported that Star Trek merchandise, by itself, had made Paramount and CBS (then co-owners of the franchise) more than $2 billion.
After having studied film and television for a year, I came to really dislike both film and television. What a bunch of greedy bastards. Pirates are truly the good guys.
@Mycel , All of this is probably legal now. When the first case is criminally prosecuted, the laws will immediately be changed so that it is legal. The system is rigged.
@Mycel There IS a system like that, sort of. If you can help the IRS get someone on tax fraud, there is a 30% bounty on whatever money they owed that goes to you. (Which is then taxed about 30-35ish % by the IRS) Its just really hard to get that evidence since it needs to stand up in criminal court.
When faced with a case where the petitioner has the money and will power to fight a prolonged legal battle with the studio a settlement is always reached before discovery. Why? It’s criminal fraud. If you are creating a fictitious loss on paper by inflating cost to avoid honoring a contract you are committing a felony. And if you can prove that when the contract was signed creating a fictitious loss was planned it’s now a laundry list of felonies. Next you know it everyone involved is being sued into bankruptcy and going to prison. This clever little trick might seem like a loop hole but it isn’t. The case law on these behaviors go well into the 1800’s. The Chief Engineer of the Union Pacific Rail Road was actually convicted and imprisoned during the construction of the first Transcontinental Rail Road for using similar accounting tactics to claim additional grant money for construction costs from the federal government. Now where these two cases differ is where whom is paying whom but the courts were quite clear on the criminality of such practices.
@Mycel wouldn't it be easier to make a deal with the studio for their profits and the profits for their subsidiaries from the movie. Because by basically transferring their profits to their subsidiaries they aren't committing any crimes.
Think about it, you wouldnt tax yourself. They’re basically the same people. The government are the studios, sports owners, etc. They’re the Superpac, lobbist, special interest, etc.
At the time of Star Wars' creation, 20th Century Fox did not believe that Star Wars would not be a blockbuster hit, and assumed the movie would just be another typical children sci-fi movie. When signing into contract with George, they only cared for the movie license only. Everything else, well George could handle that on his own since they didn't want anything to do with a movie they thought at the time, was starting to go over budget. To elaborate on this further, Kenner Toys, the first toy company to get the rights to produce Star Wars toys, didn't think that Star Wars would sell a lot of merchandise and so delayed production on their Star Wars line until opening launch, where Kenner suddenly found itself buried with letters about supply and demand for Star Wars toys, from both retailers and fans of Star Wars, hence the infamous 1977 Star Wars Cardboard Preorder fiasco that Kenner pushed to get children to buy Star Wars toys when there was none to begin with.
It reminds me of Shakespeare in Love. The Producers' producers illegally sold themselves short. In contrast Shakespeare's producer did what modern studios do today, as Simon says.
People: We should buy/stream (instead of acquiring) movies so the writers/producers/actors get paid more for their effort!!! Studios: AhahHAhAhahAHAhahahahahAHahAHahahaHAHahahahahAHahahahhaahahAHAHHAAHAHahhaahah.
The same thing goes for music back when piracy was on the rise. The complaint was the musicians were losing out to piracy, but music production companies stuck it to musicians with really screwed up contracts.
Every major movie studio ever: we are cheating on our taxes and bills and everyone knows it. US government: huh? What? I couldn't hear you over the sound of money clinking
Yes, it is all, I am sure, legal, but the is a massive differnace between legal and moral. There is very very little morally right about the american 'justice' system.
NO. Its not fraud. They are playing the game according to how its designed. The flaw is the game not the player. No fraud needed. ITs not deceptive, people know what they are signing up to. It's just incredibly complex and requires a skilled negotiator, legal team..
He has to say it... If you want a funny and epic example of the risks, lok at "SLAPP suits -last week tonight"...the song at the end is epic (it's on youtube)
Here's the thing: this type of accounting is done everywhere by everyone (obviously the quality of the accounting varies). It only makes news, or videos like this, when the millionaires are fighting billionaires. The little guy is always getting screwed and the Accounting "profession" doesn't give a shit as long as 'it gets paid'.
The thing I would really like to know if how much money does a movie make from product placement? I'm sure it's a pretty penny, and reduces the 'cost' of making a movie by A LOT. Can you do a follow-up video on the money made from product placement in movies?
It's a bit like how a certain fruit themed technology company pays virtually no tax in Australia, despite selling container loads of massively over priced product every day. They buy in their inventory from entities (owned by their parent company) located in tax havens at vastly inflated prices , their mark up being barely large enough to cover their local expenses.
Hollywood morals: if a woman's not interested stalk her, chase her, and wear her down until she gives in. Definitely ignore when she says no. Also, romances written by men who think what women want is to learn how "stuck up" they were and how they should have settled for the entitled Nice Guy who never left her (despite her not being interested) and eventually wore her down or caught her in a vulnerable, heartbroken moment and was super "caring" but actually it was just manipulation.
hollywood is a company.. you either have democracy supporting the rich guys in company.. or you get capatlism where you get the idea of soviet union style.. Heck, look up in history every major big civilaztion fell.. egypt fell, roman empire fell.. even though economy based.. So no matter what.. you will have people who will sit on top keep you poor :)
one convenient trick, ohh we made money.... lets put this luxury car as expense (exec appears with new BMW/Jaguar next day)... ohh bum, movie made no profit, sorry stars, no royalties for you guys. + ofc maximum tax deductions for negative bottom line.
@@veggielovers7502 It's more like the opposite. Money laundering is making money appear out of thin air, Hollywood accounting is making it disappear. For example charging a customer 50$ for a service, but reporting it having cost 100$ and getting the other 50 out of your stash from illegal drug sales is money laundering. You pay say 20% tax on it, and now you have 80 clean dollars instead of 50 clean and 50 dirty ones. This is what anyone who runs a black market business needs to do if they want to buy something expensive, like say a house, without the IRS coming knocking asking where they got that kind of money. Hollywood accountants simply state they paid 100$ for a service that actually cost 20, so they can submit a greater amount as business expenses, pay less taxes and cut out people whose pay would be proportional to profits. And it's not just Hollywood, just about all wealthy individuals and large corporations do this, they hire people who know all the loopholes and make a career out of providing this service.
Took a puff on cannabis every time Simon said "on paper"... based on what was in the room and seeing your comment ... the three of us are now dying laughing and coughing. Thanks for the suggestion.
I want to see an attorney take on one of these types of cases as a passion project. Take it on as a 'I get paid when you do, but we aren't settling' sort of deal. I'd LOVE to see someone stick it to Hollywood. I've honestly never seen such shady business practices be condoned legally. It's really appalling and I feel like it must violate some sort of anti-trust law.
@@muznick You've got it backwards. The powerful private interest groups and the government pay the studios to follow their agendas. Ever wonder why movies seem to be prophetic?
standing to sue and lack of government intervention lets these things survive. People can't just take these creative company practices to court, you have to be screwed by them, and then also have to prove the owners of the shell company are liable too. Governments not touching these terrible practices is another problem
Oh Amanda how pure you are. Here's some things to think about. In a capitalist sense of the world, the #1 goal for any business entities (profit taking companies) is to *maximize profit* for the *stakeholders* , i.e. shareholders &/ executives, but it's sadly excluding the workers most of the time. To add on top of that, unlike a communist system, in a capitalist sense of the world, the most successful companies often holds enormous power over any governmental bodies to influence on how they govern (e.g. the regulatory system, etc) to further support the running and all of the various goals (mission & vision) of the companies. So yeah it's kind of F*ed up, eh.. Oh and you could argue that it's just got way worse & transparent when Trump got elected (shameless* businessman in office). I mean blatantly insisting on spending time (staying*) at his resort (Winter/Southern White House, Mar-a-lago) is basically giving tax dollars to his own private estate -- the very same practice the companies in this video talked about. 😂😋
You know they have lawyers right? Sooo, someone "taking on Hollywood", probono at that, is going to bring down the machine? And basically then, the entire US economy, cause that's just how this country works... Those with money, keep it. That's why they have it. Meanwhile, those who actually do everything get fucked and die poor. Look at tesla. Not the company, their namesake.
The Adam Sandler movie “Jack and Jill” is stated by “Happy Madison Productions” to have cost 80 million dollars to make......80 MILLION DOLLARS! That is a blatant, obvious, and ridiculous lie.
Who sat there and listened to the pitch for that turd, or read that script n thought yup heres 80 million. This baffles me every time i flick by ridiculously dumb movies. Clearly its a turd n someone dishes out 10s of millions, wtf
Sandler allows ridiculous budgets for keeping the staff (AKA, his friends) happy. It's a giant vacation for him, his friends, and his family that he gets to finance through movies.
Something tells me if we were to have a more straightforward tax system a lot of these ‘loopholes’ would be closed and other services could be provided
@@Cleron_O_Andarilho true, but my understanding was that he accepted a very small (buy Hollywood standards) paycheck and had a deal in his contract that he got a percentage of the profits on the backend.
@@ketami2 Yeah, so if make it success he win big, but like they say, they try to reduce this to not pay anyone. The power that a actor have over a franchise can be a good way to ask for more. Like JAck Sparrow, many people would not watch Pirates of the Caribean withou Jack Sparrow, or The Iron man himsef etc. Thats why studio love to reset things, like Batmans, people dont get attached and love when we hate the actor, so they can change without loss of money
Give a shout out to Mel Brooks and his little film The PRODUCERS! he explains the nature of Hollywood brilliantly! This happens with Pop and Rock group touring companies too. They do not make money There is one for you SIMON!
There's a famous sportsman - we'll call him John Doe, who "earned" a huge salary. Unfortunately he couldn't keep most of it as his name was registered by a company in the Caribbean. So he had to pay this company a huge amount of money for permission to use his name. To cap it all, this company was in a country where no tax is paid. As a result, he just earned enough to live on and only paid tax on what he was paid after paying the Caribbean company. The only redeeming factor was that he also owned the Caribbean Company!
Love that video. It's not just companys in the spot light that plays those games. I work for a large trucking company. The owner leases his trucks from a company he owns.
I talked with John Landis about the lawsuit regarding COMING TO AMERICA. Even though they lost, Art Buckwald received a small payoff, but according to Landis, because the suit forced the studio to open their books about how much money the movie REALLY made, Landis and Eddie Murphy made an additional $7 million!
OK, as a businessman/'Tuber, this got me thinking. The accounting helps studios avoid paying out on net profit deals but how would it help with taxes? The wholly-owned subsidiaries being paid exorbitant fees would be consolidated for taxes so it wouldn't lower earnings for the whole company...or is there something I'm missing? Great video btw, been watching the channel for a few weeks. Love it!
Its the exact same accounting that got people so heated about Amazon paying zero in taxes. Companies only pay taxes on profits and write off losses on tax deductions. If these companies never turn a profit, they never really pay taxes. Additionally, they demand tax breaks to film in certain areas.
My guess is the taxes paid vary depending on the type of business, or official location of the company. So an LA based movie studio could pay itself for advertising services by a subsidiary marketing company operating out of Ohio (random picks, don't know USA tax values), and apply the more lenient taxation.
I saw something about this on another channel. I believe the subsidiary was the movie itself. So it would be the studio paying "Forest Gump Movie Company Inc.". After filming is completed the subsidiary files bankruptcy is then purchased by the studio allowing it to write off the losses from the purchased company that was really just itself.
If this Weldon company had some kind of warranty, I could see the value. I like the product, I just don’t want to pay a premium price and have it wear out after a year or two. At least with hiking gear they usually have a life time warranty along with the high price.
I read that the members of Monty Python refused to allow one of their movies to be released on video, as according to the studio it hadn't made a profit. Shortly afterwards, the studio decided that it had made a profit, and the movie was then released on video.
My brother co-produced a few movies in the early 2000s. He has a friend writer/director that somehow always gets investors for his bad movies. It's weird. Anyway, I bring it up because he told me that theaters (back then) only recorded a percentage of actual ticket sales- and it was totally known they did that. So the theaters were also cooking the books to pay the distributors less. Seems like the entire industry was totally corrupt.
Insufficient staffing. Seriously, the IRS has an massive problem with recruiting and funding despite the fact that they are the most important department in the US. It’s pretty much what you can expect the Police to wind up being of this whole Defund the Police bullshit gains any traction.
It’s just like Nathan Cassady says. The IRS are vilified and under budgeted. Because of this they cannot manage to tax these mega corporations properly. The rich get richer and the poor get poorer.
it is amazing to me how many people didn't know about "Hollywood accounting" long before now. I have known about it since the 1990's. Heck, Jack Nicolson took advantage of it when he played Joker, to get a bit of the gross of ANY batman movie made after
Oh, you mean the industry that makes half of its product using stories of rape and murdering women as "entertainment"? Where exactly are they lecturing us about morality, I must have missed that.
Many years ago I worked as an IT Accounting Systems Coordinator. The accountants liked to tell "war stories" about things that had happened in the accounting world. One story was (and I have no idea if it was true) concerned a Hollywood studio that charged off its prostitution expenses as limousine rental expenses. Supposedly, an audit was done, and based on the amount paid for limousine rental the auditor required that the studio purchase limousines rather than rent them in order to save money.
'catering' has had the same treatment. there are cases where the 'restaurant' used for catering was a strip club and so on. recoding expenses is its own world of crazy accounting
Maybe you could do another video on the money blown on the budget that some expensive films do. I saw an article the had interviews of insiders who talked about the wasted money that went into nonsense like the destruction of multiple expensive (and brand new!) luxury cars, for ONE 10 minute car chase scene that could have been cut to 5 minutes and only “needed” to destroy a couple of “more budget friendly “ cars, for example. Or the wasted funds for excess craft services (or expensive food stuffs) that nobody touches.
@@BlueSkies30 The opposite is also true. More lack of money, the greedier the people. When there is NO money, that's when people start to kill for things.
@@MrSixPool Killing for survival isn't greed, it's being desperate. The low life criminals are often not getting a lot of money from their crimes, or it all goes to the drugs they are addicted to (being addicted to drugs is not greed). It's the mafia and other up and up criminals who get truly greedy. And people who resort to crime are not the same as the majority who make barely enough to pay the bills who are honest to god good workers and pay their bills on time without trying to jump through hoops to avoid them. And if you're not super rich, you pay for any fraud you do. The rich businesses can pay for fantastic lawyers who will win their case (or help settle for less money!), and they are getting so much money from the loophole that even after paying the fantastic lawyer (and/or settling) they still make a bunch of extra profit that should rightfully be going to the people lower on the totem pole. We aren't talking about money that the lower is demanding for because they want to get a new car, we're talking about money they were rightly OWED for their work, and the businesses find a loophole to pay them less than they rightfully should get [and they cheat out of taxes doing so in Hollywood by claiming a loss]. My biggest bone to pick is that they get away with this in the end, when people barely making it can't catch any breaks, cause they can afford to pay off people to find loopholes that are never patched up. People only really get greedy when they have too much money. imo The more you have, the more you want. Some people do a decent job avoiding this, but if you're in a business like Hollywood, it's hard to be rich and not greedy.
@@BlueSkies30 That's a fine line to draw. In theory. But what criminal would go out, rob someone for $100 and return $50 before he only needed $50? In truth, the line between want and need is very blurry. It's usually hard to say which is which. This is especially true in our society when the most basic food needs and housing needs is provided for. Only the mentally ill doesn't go to a food bank or homeless shelter. The regular people who are down on their luck usually find food and shelter provided by the government.
@@MrSixPool Just surviving isn't living. Wanting a 2 bedroom house with a decent kitchen, bath, etc. and property isn't greedy. Wanting to buy your own food isn't greedy. Wanting to go on vacation every few years isn't greedy. Wanting to go to college isn't greedy. (Especially compared to the people living in mansions). There's a lot on this list you can't get when you're going to the homeless shelter and such. Of course a criminal isn't going to return the money - who knows the next time they can steal? When they'll get caught? They might get caught returning the money. That's silly. If they are in a highly organized crime group like a mafia it is easy to find yourself wanting more, but most low life criminals aren't going to build up to mansion life. Often times that extra money just means more cocaine and such. They get enough drugs to last the day but they are still slumming it. And you still miss the point with that example. Rich or poor, a criminal is a criminal. Difference is the poor are usually doing crime for scraps compared to the rich, and the rich get away with it. You can't compare someone with a job trying to have a decent life to someone who is doing crime so they don't have to work or so they can buy a bigger mansion (and still the person doing crime to get out of work is less greedy than the mansion one).
Inter-company translations....the number one way that companies move revenue out of a costly enterprise and into a cheap one. This is usually done in order to move profits from a high tax jurisdiction to one with a lower tax rate. However, any cost arrangements tied to the "Net Income" of a given legal entity can be reduced in the same way.
Bill Burr was talking about this on the Joe Rogan podcast recently. You can find the clip of the conversation and I highly recommend watching it. It’s a good example of how shitty the whole scam is.
Thank you for your comments on baseball. That was really amazing, well presented, and best of all, done in a beautiful non-American accent. Just really nice job.
My favourite example was Superman Returns. They claimed it cost $500 million to make, but that was because they included all the development expenses for Superman Lives for the previous 20 years. So the Superman Returns budget includes Kevin Smith's script, Nic Cage's contract, and building the giant spider monster. On the flip side, Jack Nicholson made $50 million playing the Joker in Tim Burton's Batman. When the studio couldn't afford his contract he agreed to scale plus a percentage.
pro tip: in film production never work for "deferred pay" aka backend "points" aka percentage. you'll never get paid even in the unlikely event it's successful. -personal experience
Potato Face Jack Nicholson did that successfully with Batman. He earned like 60 million dollars. That’s an insane actor salary now, let alone in the 90’s.
Supposedly the story with Forrest Gump is that the author was approached to sign off on making the sequel and he refused to do so because the first movie supposedly lost money. It didn't make sense to make another movie that could lose money as well.
The fact that you can do a video about this is great, the fact that studios are still able to get away with doing this when its well known enough to make a video about is horrifying. Once again we see why our Economies are broken and need to be fixed.
Manufacturing companies do this too. When I was working at Hoffman they wrote that most of their losses is rework. They claim half of the work was done wrong and must be redone when in reality there was nothing changed. They do this to not have to pay half of the work both to employees and not have to pay the government taxes.
I love how you promoted the patron, then immediately throw patrons under the bus by saying Mack Weldon is responsible for this episode. Over two minutes for selling out, less than 20 seconds for your base. Good job. 👎👎 You earned them.
Disney decided that the film John Carter was going to be a bomb, and so they added production costs from films dating back to the 70's . So it had not chance .
SHUT HOLLYWOOD DOWN. That town needs to be cleaned up, badly. We all now know that Mel Gibson was correct on all accounts of Hollywood, despite his words not agreeing with our politeness, the 'special interests' lawyers and culture-propagandists.
You know, now it makes so much sense how Billy Madison Productions is able to sing on so many big names, in particular all his friends, despite the low budgets and likely lower pay offered, they actually get paid.
Reminds me of a joke. A company is hiring a new accountant. Three people apply and attend for interview. The first accountant comes in. The interview board discuss his experience and look at his CV. Finally they hand him a piece of paper with some account details on it. "Using these figures, calculate how much tax we should pay" they ask. Pulling out his calculator the first accountant taps away and a few seconds later then shows the result to the interview board. "Very good, that was amazingly fast. It will take a lot to beat that." the board say. And the interview ends. The second accountant enters. like before, they discuss his experience and CV. And then comes the final question. "Using these figures, calculate how much tax we should pay" they ask. Pulling out a pencil and paper, the account scribbles away, and in short order, shows his answer to the board. "Amazing, All done in your head. Certainly you are very skilled" they say. And the interview ends. Finally the last accountant enters. As with the last two interviews, experience and CV are discussed, and again the question asked. "Using these figures, calculate how much tax we should pay" they ask. The accountant looks at the paper, smiles, leans forward and says "How much do you want to pay?"
As an accountant I can assure you this is not just done in Hollywood, this is pretty much standard its just that Hollywood doesn't have to show a profit
This is one of the most disgusting thing I've seen in a long time. Not only the extreme greed but the fact Hollywood is so easily able get away with all of this. Its all just so horribly corrupt and broken it makes me sick.
Go check out Mack Weldon and get 20% off by using the link: mackweldon.com/brainfood20 and the promo code brainfood20 Thanks for supporting this channel. :-)
So now I understand why Hollywood is so liberal and vote democrat. it's a ta scam partnership between them.
Try that in south texas. sweating to the point you could wring the shirt out at the end of the day.
You look like a low budget vsause😂
When it coms to this Mack Weldon, how does it compare to M&S, oh English Guru Hipster man? Also so they just do skinny hipster sizes or can they cope with meaty blubbery men shaped dudes?
College acting teacher said never take a profit pay. They run two books.
"Hollywood accounting" otherwise known as "tax evasion".
Not really tax evasion, because somewhere along the line those taxes are being paid. But as mentioned in the video, anyone getting paid based on net profit is getting shafted - and Hollywood studios are more than happy to write deals like that up.
No . its not "evasion". its "avoidance". Big difference.
@@rodh1404 You said "somewhere along the line taxes are getting paid". Are you sure about that? I know lots of film production left Hollywood because other states started offering tax credits and tax rebate deals to get the film companies to shoot in those states. I think Georgia won the race to the bottom, and some stuff is shot in Canada and Prague to avoid paying any taxes. So I'm not buying your claim
That's libel sir. Tax evasion requires one to break or ignore tax laws. What they're doing is tax avoidance which is doing every possible thing allowed by law to minimize your tax burden.
@@stevechance150 As Christopher Woodbury said, tax minimization isn't the same as tax evasion. I do agree that at the level it's done by many big businesses, it's extremely dodgy, but still legal.
Lesson learned: take royalties on gross receipts, and NOT royalties on profits where the "profits" can be manipulated.
That’s true with literally everything lol
@@swordstrafe English 100
Just demand a high lump sum.
Then threaten the exec with your female friend calling them a rapist if they don't hire you.
Royalty flat fee on each theater performance and DVD/tape _produced_ not sold.
Tell that to Andrzej Sapkowski , writer of the witcher that took money over percent of sales.
And yet these guys cry foul over "pirating' bit of a double standard
That's because, as they so clearly demonstrating with losing 40% to an "easily replaceable" actor, they don't just want to make some of the money, they want to make ALL of the money, legitimately or not
And all this even though it's more or less proven that piracy causes no damage at all...
and the same rich that tell americans do more and do better.
but then they lose their shit when mel gibson notes who almost exclusively runs hollywood and points out how fucking greedy ass two faced they all are.
the horror.
@@scottmiller4295 ~ Antisemitism. Stay classy, scott.
They should be happy, pirates are helping them losing money.
Warner Brothers: We made 1 Billion dollars on this film.
Irish Warner Brothers Pencil Company: We charge 1 billion dollars per pencil rental.
Warner Brothers: oops, we made no money on that film, oh well.
willyolio oh hey look this company payed us a billion dollars!
This should be the top comment
Does that include the sharpener?
And if anyone else tried to pull this they'll get told: "I'm sorry, those loopholes are only for those in the loop." And now you know how movie companies and even major corporations pay absolutely nothing in taxes year after year after year. But if you're even so much as late paying your taxes, they'll eviscerate you without hesitation. Why do they attack average people and not the companies? Well, companies like these can pay lawyers tons of money giving them teeth that the IRS isn't willing to fight with, which can get rather costly for the IRS. This is why the average tax payer gets the shaft and there's little they can do about it.
A boring dystopia indeed
@Nigel Lush How's that boot taste?
Pay lawyers? How naive, they pay politicians and get nice loopholes made to order...
@@trauko1388 Which is why They hate Trump. Because he wants to replace said loopholes with new loop holes that only he can abuse.
That comment is better than the video
So "The Producers" was actually a documentary and guide line for movie companies how to evade taxes.
What a timeless classic!
Where can i find it?
@@Ridhwan999 Can find what?
@@vindobonaification the documentary
And they wonder why the MPAA’s claims about the costs of piracy are mocked...
Makes you feel better about watching sports and movies illegally. He could do a video about Ticketbastard.
I remember in the 90s Paramount kept saying they were losing money on the Star Trek franchise. Then they got a new leader. She made it very clear that past statements were lies. She reported that Star Trek merchandise, by itself, had made Paramount and CBS (then co-owners of the franchise) more than $2 billion.
not anymore sadly, new trek is shiiit
@@lovecchio420 That's what you get when you hire people who'd rather work on Star Wars and Mass Effect, who then try to turn Star Trek into those.
@@lovecchio420 nah...Discovery is great...Picard on the other hand fizzled out 2 episodes in. It's simply not good
Too many non gentile people in the business.
@@Catani84 I hate you. Literal hate for your opinion.
After having studied film and television for a year, I came to really dislike both film and television. What a bunch of greedy bastards. Pirates are truly the good guys.
And that’s why everyone who has a successful series or movie franchise hires a forensic accountant and forces the studio to settle.
@Mycel , All of this is probably legal now. When the first case is criminally prosecuted, the laws will immediately be changed so that it is legal. The system is rigged.
@Mycel There IS a system like that, sort of. If you can help the IRS get someone on tax fraud, there is a 30% bounty on whatever money they owed that goes to you. (Which is then taxed about 30-35ish % by the IRS) Its just really hard to get that evidence since it needs to stand up in criminal court.
When faced with a case where the petitioner has the money and will power to fight a prolonged legal battle with the studio a settlement is always reached before discovery. Why? It’s criminal fraud. If you are creating a fictitious loss on paper by inflating cost to avoid honoring a contract you are committing a felony. And if you can prove that when the contract was signed creating a fictitious loss was planned it’s now a laundry list of felonies. Next you know it everyone involved is being sued into bankruptcy and going to prison. This clever little trick might seem like a loop hole but it isn’t. The case law on these behaviors go well into the 1800’s. The Chief Engineer of the Union Pacific Rail Road was actually convicted and imprisoned during the construction of the first Transcontinental Rail Road for using similar accounting tactics to claim additional grant money for construction costs from the federal government. Now where these two cases differ is where whom is paying whom but the courts were quite clear on the criminality of such practices.
@Mycel wouldn't it be easier to make a deal with the studio for their profits and the profits for their subsidiaries from the movie. Because by basically transferring their profits to their subsidiaries they aren't committing any crimes.
@Mark Honea ... no shit
I’ve always wondered where the accounting firms and the IRS are when the studios claim this BS on their tax returns.
It's all legal on a state and federal level sadly!!!
@@DarthAwar the crazy who rave taxes are government stealing makes sense now.
The companies that pay themselves for distributing and marketing the films probably pay taxes, unless they incorporate in the Seychelles or some such.
It's called lobbying.
Think about it, you wouldnt tax yourself. They’re basically the same people. The government are the studios, sports owners, etc. They’re the Superpac, lobbist, special interest, etc.
I still feel like Hollywood producers and accountants just watched Mel Brooks' The Producers and said to themselves, "That's not a bad idea!"
And best move ever by George Lucas:
Take merchandising rights instead of money. Why would you need money if you have the licence to print it?
He got a percentage I believe of the original Star Wars...but kept the merchandise, and the rights to any of the sequels.
At the time of Star Wars' creation, 20th Century Fox did not believe that Star Wars would not be a blockbuster hit, and assumed the movie would just be another typical children sci-fi movie. When signing into contract with George, they only cared for the movie license only. Everything else, well George could handle that on his own since they didn't want anything to do with a movie they thought at the time, was starting to go over budget.
To elaborate on this further, Kenner Toys, the first toy company to get the rights to produce Star Wars toys, didn't think that Star Wars would sell a lot of merchandise and so delayed production on their Star Wars line until opening launch, where Kenner suddenly found itself buried with letters about supply and demand for Star Wars toys, from both retailers and fans of Star Wars, hence the infamous 1977 Star Wars Cardboard Preorder fiasco that Kenner pushed to get children to buy Star Wars toys when there was none to begin with.
This reminds me of the movie "The Producer" about this 'creative accounting'.
Michael McCarthy Mel Brooks knew about Hollywood
Just about the only musical I enjoyed sitting and watching in it’s entirety
It reminds me of Shakespeare in Love. The Producers' producers illegally sold themselves short. In contrast Shakespeare's producer did what modern studios do today, as Simon says.
Many people don't know this, but the Fuhrer was descend from a long line of English queens.
People: We should buy/stream (instead of acquiring) movies so the writers/producers/actors get paid more for their effort!!!
Studios: AhahHAhAhahAHAhahahahahAHahAHahahaHAHahahahahAHahahahhaahahAHAHHAAHAHahhaahah.
The same thing goes for music back when piracy was on the rise. The complaint was the musicians were losing out to piracy, but music production companies stuck it to musicians with really screwed up contracts.
Every major movie studio ever: we are cheating on our taxes and bills and everyone knows it.
US government: huh? What? I couldn't hear you over the sound of money clinking
So they're using loopholes and committing fraud.
But in this case it is probably borderline legal fraud.
Yes, it is all, I am sure, legal, but the is a massive differnace between legal and moral. There is very very little morally right about the american 'justice' system.
No wonder they never want fan films or independent productions to succeed.
NO. Its not fraud. They are playing the game according to how its designed. The flaw is the game not the player. No fraud needed. ITs not deceptive, people know what they are signing up to. It's just incredibly complex and requires a skilled negotiator, legal team..
@@darkstorminc It's not the government that's being defrauded, though. It's all the little people in and around Hollywood.
All the "allegedly" words had me thinking I was watching Business Blaze, but Simon was being too tame...
same
Allegedly
He has to say it...
If you want a funny and epic example of the risks, lok at "SLAPP suits -last week tonight"...the song at the end is epic (it's on youtube)
he didn't have his "cereal" this morning
Alas, without the same punch as he says it on Business Blaze.
And they're worried about me downloading an old movie from the 30s.
US Copyright expires after 75 years... so that should be ok.
@@That_Guy78 Plus the authors life. So if the author died in 2000 we have to wait until 2075 to make an adaptation on a film from fucking 1930.
@@Bladeofwar94 and yet they invoice 1billion for a pencil.
@@That_Guy78 tell that to disney
Here's the thing: this type of accounting is done everywhere by everyone (obviously the quality of the accounting varies). It only makes news, or videos like this, when the millionaires are fighting billionaires.
The little guy is always getting screwed and the Accounting "profession" doesn't give a shit as long as 'it gets paid'.
Which is why the little guy needs to start guillotining millionaires, billionaires, and their families.
I must be fucking up my taxes then, because I don't have a shell company
The thing I would really like to know if how much money does a movie make from product placement? I'm sure it's a pretty penny, and reduces the 'cost' of making a movie by A LOT. Can you do a follow-up video on the money made from product placement in movies?
It's a bit like how a certain fruit themed technology company pays virtually no tax in Australia, despite selling container loads of massively over priced product every day. They buy in their inventory from entities (owned by their parent company) located in tax havens at vastly inflated prices , their mark up being barely large enough to cover their local expenses.
I avoid the aforementioned fruit themed company, with a passion(fruit)....
I love how Hollywood wants to preach morals and tell everyone else how to live all the while blatantly doing stuff like this.
They are not the only ones.
Can't trust a liberal
Hollywood morals: if a woman's not interested stalk her, chase her, and wear her down until she gives in. Definitely ignore when she says no. Also, romances written by men who think what women want is to learn how "stuck up" they were and how they should have settled for the entitled Nice Guy who never left her (despite her not being interested) and eventually wore her down or caught her in a vulnerable, heartbroken moment and was super "caring" but actually it was just manipulation.
@@jellyfishi_ This goes back quite a ways; the most dangerous was the big- name directors & producers; studio heads are the worst.
hollywood is a company.. you either have democracy supporting the rich guys in company.. or you get capatlism where you get the idea of soviet union style.. Heck, look up in history every major big civilaztion fell.. egypt fell, roman empire fell.. even though economy based.. So no matter what.. you will have people who will sit on top keep you poor :)
This sounds like money laundering to me...
It really resembles it. Can someone confirm how much this fits the term of money laundering?
I wonder how true that part of Sopranos is where Nick went to fund hollywood film...
one convenient trick, ohh we made money.... lets put this luxury car as expense (exec appears with new BMW/Jaguar next day)... ohh bum, movie made no profit, sorry stars, no royalties for you guys. + ofc maximum tax deductions for negative bottom line.
@@veggielovers7502 It's more like the opposite. Money laundering is making money appear out of thin air, Hollywood accounting is making it disappear.
For example charging a customer 50$ for a service, but reporting it having cost 100$ and getting the other 50 out of your stash from illegal drug sales is money laundering. You pay say 20% tax on it, and now you have 80 clean dollars instead of 50 clean and 50 dirty ones. This is what anyone who runs a black market business needs to do if they want to buy something expensive, like say a house, without the IRS coming knocking asking where they got that kind of money.
Hollywood accountants simply state they paid 100$ for a service that actually cost 20, so they can submit a greater amount as business expenses, pay less taxes and cut out people whose pay would be proportional to profits. And it's not just Hollywood, just about all wealthy individuals and large corporations do this, they hire people who know all the loopholes and make a career out of providing this service.
Some films are actually money laundering schemes funny enough.
When Hollywood cooks the books, they go 5 star restaurant.
Ba duh ba buh buh psssssshhhh!
SyntaxError 999 A 5 star restaurant doesn’t exist. It’s a max of 3 stars.
Oh hi there Depends on what you mean. Accolades, max 3. Reviews? Max 5 or 10.
@@AmaraJordanMusic Michelin stars.
Hollywood isn't the only one; there are others.
So they try to get out of paying for stuff that's not theirs and then get mad at us for pirating their movies. I'll keep on pirating away arrrrrrrgh
Phukk yeah. Get yours bro
That's why stop buying movies a long time ago lol
Take a shot every time Simon says "on paper" lol
Or allegedly haha
Took a puff on cannabis every time Simon said "on paper"... based on what was in the room and seeing your comment ... the three of us are now dying laughing and coughing. Thanks for the suggestion.
*dies*
oh my liver.
I can't, I have to do things this evening, I can't be sloppy drunk lol
I want to see an attorney take on one of these types of cases as a passion project. Take it on as a 'I get paid when you do, but we aren't settling' sort of deal. I'd LOVE to see someone stick it to Hollywood. I've honestly never seen such shady business practices be condoned legally. It's really appalling and I feel like it must violate some sort of anti-trust law.
Since they sprinkle money all around to other powerful people, they will never have to obey any laws they don't want to.
@@muznick
You've got it backwards. The powerful private interest groups and the government pay the studios to follow their agendas. Ever wonder why movies seem to be prophetic?
standing to sue and lack of government intervention lets these things survive. People can't just take these creative company practices to court, you have to be screwed by them, and then also have to prove the owners of the shell company are liable too. Governments not touching these terrible practices is another problem
Oh Amanda how pure you are. Here's some things to think about. In a capitalist sense of the world, the #1 goal for any business entities (profit taking companies) is to *maximize profit* for the *stakeholders* , i.e. shareholders &/ executives, but it's sadly excluding the workers most of the time.
To add on top of that, unlike a communist system, in a capitalist sense of the world, the most successful companies often holds enormous power over any governmental bodies to influence on how they govern (e.g. the regulatory system, etc) to further support the running and all of the various goals (mission & vision) of the companies.
So yeah it's kind of F*ed up, eh.. Oh and you could argue that it's just got way worse & transparent when Trump got elected (shameless* businessman in office). I mean blatantly insisting on spending time (staying*) at his resort (Winter/Southern White House, Mar-a-lago) is basically giving tax dollars to his own private estate -- the very same practice the companies in this video talked about. 😂😋
You know they have lawyers right? Sooo, someone "taking on Hollywood", probono at that, is going to bring down the machine? And basically then, the entire US economy, cause that's just how this country works... Those with money, keep it. That's why they have it. Meanwhile, those who actually do everything get fucked and die poor. Look at tesla. Not the company, their namesake.
I really like that since starting Business Blaze, he's had a bit of bleedover and seems to just act a little more like himself on his other channels.
I don't. Seeing him on BB reminds me of the 'that guy' that was ALWAYS the 1st asked to leave a party.
It’s interesting how divisive this is. Some people love it, some hate it. I tend to notice when it happens and find it interesting either way.
@@evanroberts2771 have fun being stupid then fool
The Adam Sandler movie “Jack and Jill” is stated by “Happy Madison Productions” to have cost 80 million dollars to make......80 MILLION DOLLARS!
That is a blatant, obvious, and ridiculous lie.
Adam Sandler is a very expensive actor and they had to hire him twice ;)
Who sat there and listened to the pitch for that turd, or read that script n thought yup heres 80 million. This baffles me every time i flick by ridiculously dumb movies. Clearly its a turd n someone dishes out 10s of millions, wtf
Sandler allows ridiculous budgets for keeping the staff (AKA, his friends) happy. It's a giant vacation for him, his friends, and his family that he gets to finance through movies.
Leedark3 - oh yah, "filmed on location"
Something tells me if we were to have a more straightforward tax system a lot of these ‘loopholes’ would be closed and other services could be provided
Dude, your beard is so freaking on point. Good show, chap. Good show.
So money laundering.
Edit: wait, then how did Robert Downey Jr get his bonus on the back end.
Probrably because he was the face of the MCU, without him the movies would flop, so he had this bargain power.
@@Cleron_O_Andarilho true, but my understanding was that he accepted a very small (buy Hollywood standards) paycheck and had a deal in his contract that he got a percentage of the profits on the backend.
@@ketami2 I was going to ask the same question! Did he somehow get a deal of the gross instead of the net?
@@ketami2 Yeah, so if make it success he win big, but like they say, they try to reduce this to not pay anyone. The power that a actor have over a franchise can be a good way to ask for more. Like JAck Sparrow, many people would not watch Pirates of the Caribean withou Jack Sparrow, or The Iron man himsef etc. Thats why studio love to reset things, like Batmans, people dont get attached and love when we hate the actor, so they can change without loss of money
Well, RDJ was the accountant...
Give a shout out to Mel Brooks and his little film The PRODUCERS! he explains the nature of Hollywood brilliantly! This happens with Pop and Rock group touring companies too. They do not make money There is one for you SIMON!
Good shout, like those 'Battle of the Bands' contests that all participants pay into.
There's a famous sportsman - we'll call him John Doe, who "earned" a huge salary.
Unfortunately he couldn't keep most of it as his name was registered by a company in the Caribbean. So he had to pay this company a huge amount of money for permission to use his name. To cap it all, this company was in a country where no tax is paid. As a result, he just earned enough to live on and only paid tax on what he was paid after paying the Caribbean company.
The only redeeming factor was that he also owned the Caribbean Company!
Well my secret is out now
Love that video. It's not just companys in the spot light that plays those games. I work for a large trucking company. The owner leases his trucks from a company he owns.
Accountants are the most creative people in Hollywood.
I talked with John Landis about the lawsuit regarding COMING TO AMERICA. Even though they lost, Art Buckwald received a small payoff, but according to Landis, because the suit forced the studio to open their books about how much money the movie REALLY made, Landis and Eddie Murphy made an additional $7 million!
OK, as a businessman/'Tuber, this got me thinking. The accounting helps studios avoid paying out on net profit deals but how would it help with taxes? The wholly-owned subsidiaries being paid exorbitant fees would be consolidated for taxes so it wouldn't lower earnings for the whole company...or is there something I'm missing? Great video btw, been watching the channel for a few weeks. Love it!
Its the exact same accounting that got people so heated about Amazon paying zero in taxes. Companies only pay taxes on profits and write off losses on tax deductions. If these companies never turn a profit, they never really pay taxes. Additionally, they demand tax breaks to film in certain areas.
My guess is the taxes paid vary depending on the type of business, or official location of the company. So an LA based movie studio could pay itself for advertising services by a subsidiary marketing company operating out of Ohio (random picks, don't know USA tax values), and apply the more lenient taxation.
I saw something about this on another channel. I believe the subsidiary was the movie itself. So it would be the studio paying "Forest Gump Movie Company Inc.". After filming is completed the subsidiary files bankruptcy is then purchased by the studio allowing it to write off the losses from the purchased company that was really just itself.
If this Weldon company had some kind of warranty, I could see the value.
I like the product, I just don’t want to pay a premium price and have it wear out after a year or two.
At least with hiking gear they usually have a life time warranty along with the high price.
When I dont pay my taxes I go to jail
When billionaire's do it they get video documentaries but no actual punitive punishment
MURICA
It's pretty common in basically every country, the abuse of power is second nature to humanity.
This was an excellent video. I was transfixed. I will watch it again, and again...and learn from it. The Stallone quote was epic.
I read that the members of Monty Python refused to allow one of their movies to be released on video, as according to the studio it hadn't made a profit. Shortly afterwards, the studio decided that it had made a profit, and the movie was then released on video.
there called "monkey points" I worked at Paramount for 8 years LOL
Peter Porreca *they’re
@@j.a.weishaupt1748 ;)
What does a constipated accountant do?
Works it out with a pencil.
Ok, that was good ..take my thumbs-up and get out!
#Hashtag my favourite dad joke
My brother co-produced a few movies in the early 2000s. He has a friend writer/director that somehow always gets investors for his bad movies. It's weird.
Anyway, I bring it up because he told me that theaters (back then) only recorded a percentage of actual ticket sales- and it was totally known they did that. So the theaters were also cooking the books to pay the distributors less. Seems like the entire industry was totally corrupt.
How has the IRS not got involved in this?
Insufficient staffing.
Seriously, the IRS has an massive problem with recruiting and funding despite the fact that they are the most important department in the US.
It’s pretty much what you can expect the Police to wind up being of this whole Defund the Police bullshit gains any traction.
I'd bet my left nut that the IRS is being bribed by them!
It’s just like Nathan Cassady says. The IRS are vilified and under budgeted. Because of this they cannot manage to tax these mega corporations properly. The rich get richer and the poor get poorer.
juniorgod321 Cushy studio job post government work for sure.
Sweet , sweet corruption .
I love your RUclips channel, Great stuff, Cheers from Australia...👍
"if we spend an extra 100 million we can save a million on taxes!"
it is amazing to me how many people didn't know about "Hollywood accounting" long before now. I have known about it since the 1990's. Heck, Jack Nicolson took advantage of it when he played Joker, to get a bit of the gross of ANY batman movie made after
If the first 2 and a half minutes of this video have taught me anything, it's that Hollywood loses money because of Mack Weldon.
They probably own Mack Weldon.
Thanks. Your researchers are amazing. I appreciate all you do, (allegedly)!
Hollywood: The people who lecture the rest of us on morality.
Oh, you mean the industry that makes half of its product using stories of rape and murdering women as "entertainment"? Where exactly are they lecturing us about morality, I must have missed that.
16:12 The lack 'Ba da bum dum tsss' hurt me
Pretty sure Amazon has still yet to make a profit.
Whenever the company is in danger of turning a profit Jeff Bezos just gives himself a raise.
Many years ago I worked as an IT Accounting Systems Coordinator. The accountants liked to tell "war stories" about things that had happened in the accounting world. One story was (and I have no idea if it was true) concerned a Hollywood studio that charged off its prostitution expenses as limousine rental expenses. Supposedly, an audit was done, and based on the amount paid for limousine rental the auditor required that the studio purchase limousines rather than rent them in order to save money.
'catering' has had the same treatment. there are cases where the 'restaurant' used for catering was a strip club and so on. recoding expenses is its own world of crazy accounting
And when you try to pirate a video they lose their minds lmao.
The sarcasm in this video is beautiful!
Ahh yes, creative accounting... The same way the ultra rich avoid taxes.
No one should pay taxes anyways
@@bisnaguitogames683 well income tax is how you get things like SSI and retirement checks so.. Just most taxes can go.
Maybe you could do another video on the money blown on the budget that some expensive films do. I saw an article the had interviews of insiders who talked about the wasted money that went into nonsense like the destruction of multiple expensive (and brand new!) luxury cars, for ONE 10 minute car chase scene that could have been cut to 5 minutes and only “needed” to destroy a couple of “more budget friendly “ cars, for example. Or the wasted funds for excess craft services (or expensive food stuffs) that nobody touches.
Hollywood rivals the banking industry in being evil, think about that next time you pay to watch a film.
Any company where millions of dollars are at stake are shady as sh*t. The more money involved, the greedier people are.
@@BlueSkies30 The opposite is also true. More lack of money, the greedier the people. When there is NO money, that's when people start to kill for things.
@@MrSixPool Killing for survival isn't greed, it's being desperate. The low life criminals are often not getting a lot of money from their crimes, or it all goes to the drugs they are addicted to (being addicted to drugs is not greed). It's the mafia and other up and up criminals who get truly greedy. And people who resort to crime are not the same as the majority who make barely enough to pay the bills who are honest to god good workers and pay their bills on time without trying to jump through hoops to avoid them. And if you're not super rich, you pay for any fraud you do. The rich businesses can pay for fantastic lawyers who will win their case (or help settle for less money!), and they are getting so much money from the loophole that even after paying the fantastic lawyer (and/or settling) they still make a bunch of extra profit that should rightfully be going to the people lower on the totem pole. We aren't talking about money that the lower is demanding for because they want to get a new car, we're talking about money they were rightly OWED for their work, and the businesses find a loophole to pay them less than they rightfully should get [and they cheat out of taxes doing so in Hollywood by claiming a loss].
My biggest bone to pick is that they get away with this in the end, when people barely making it can't catch any breaks, cause they can afford to pay off people to find loopholes that are never patched up.
People only really get greedy when they have too much money. imo The more you have, the more you want. Some people do a decent job avoiding this, but if you're in a business like Hollywood, it's hard to be rich and not greedy.
@@BlueSkies30 That's a fine line to draw. In theory. But what criminal would go out, rob someone for $100 and return $50 before he only needed $50? In truth, the line between want and need is very blurry. It's usually hard to say which is which.
This is especially true in our society when the most basic food needs and housing needs is provided for. Only the mentally ill doesn't go to a food bank or homeless shelter. The regular people who are down on their luck usually find food and shelter provided by the government.
@@MrSixPool Just surviving isn't living. Wanting a 2 bedroom house with a decent kitchen, bath, etc. and property isn't greedy. Wanting to buy your own food isn't greedy. Wanting to go on vacation every few years isn't greedy. Wanting to go to college isn't greedy. (Especially compared to the people living in mansions). There's a lot on this list you can't get when you're going to the homeless shelter and such.
Of course a criminal isn't going to return the money - who knows the next time they can steal? When they'll get caught? They might get caught returning the money. That's silly. If they are in a highly organized crime group like a mafia it is easy to find yourself wanting more, but most low life criminals aren't going to build up to mansion life. Often times that extra money just means more cocaine and such. They get enough drugs to last the day but they are still slumming it.
And you still miss the point with that example. Rich or poor, a criminal is a criminal. Difference is the poor are usually doing crime for scraps compared to the rich, and the rich get away with it.
You can't compare someone with a job trying to have a decent life to someone who is doing crime so they don't have to work or so they can buy a bigger mansion (and still the person doing crime to get out of work is less greedy than the mansion one).
Wow, this is a awesomely informative and entertaining episode, thank you guys so very much.
Take care and stay safe, peace.
This is a different take on the plot from "The Producers".
Inter-company translations....the number one way that companies move revenue out of a costly enterprise and into a cheap one. This is usually done in order to move profits from a high tax jurisdiction to one with a lower tax rate. However, any cost arrangements tied to the "Net Income" of a given legal entity can be reduced in the same way.
Bill Burr was talking about this on the Joe Rogan podcast recently.
You can find the clip of the conversation and I highly recommend watching it. It’s a good example of how shitty the whole scam is.
Thank you for your comments on baseball. That was really amazing, well presented, and best of all, done in a beautiful non-American accent. Just really nice job.
This sounds like "THEIR LAWYERS' ARE THEIR ACCOUNTANT".
Do the video games industry next!
"It's a big club, and you ain't in it" - George Carlin
My favourite example was Superman Returns. They claimed it cost $500 million to make, but that was because they included all the development expenses for Superman Lives for the previous 20 years. So the Superman Returns budget includes Kevin Smith's script, Nic Cage's contract, and building the giant spider monster.
On the flip side, Jack Nicholson made $50 million playing the Joker in Tim Burton's Batman. When the studio couldn't afford his contract he agreed to scale plus a percentage.
Very true...
10th Rule of Acquisition - Greed is eternal.
WOW!!! Great Explanation!!!
pro tip: in film production never work for "deferred pay" aka backend "points" aka percentage. you'll never get paid even in the unlikely event it's successful. -personal experience
Potato Face Jack Nicholson did that successfully with Batman. He earned like 60 million dollars. That’s an insane actor salary now, let alone in the 90’s.
Seems to work with cult hit films. Starwars being an example. Alec Guinness got 2% (should've been higher)
Hello from Fact Fiend 😊
This is peak capitalism.
I've been hearing "Segway" when someone says "Segue" and it still made perfect sense every time
And that why pirating is a must for any new movies
Allegedly 😇
Supposedly the story with Forrest Gump is that the author was approached to sign off on making the sequel and he refused to do so because the first movie supposedly lost money. It didn't make sense to make another movie that could lose money as well.
James Cameron says he made "0" on Titanic.
The fact that you can do a video about this is great, the fact that studios are still able to get away with doing this when its well known enough to make a video about is horrifying. Once again we see why our Economies are broken and need to be fixed.
2:27 video starts
Manufacturing companies do this too. When I was working at Hoffman they wrote that most of their losses is rework. They claim half of the work was done wrong and must be redone when in reality there was nothing changed. They do this to not have to pay half of the work both to employees and not have to pay the government taxes.
So basically make the deal that for every 1 million the film loses you get 100,000.
A cool box ?!?! ..you guys across the pound are hilarious 🤣
simon : "its almost certainly better than what you were using before"
me : flips off my screen
😂 The antagonism is working! 😈
Suggestion: lets just stop watching Hollywood movies altogether. Most of what they are churning out for years has been complete crap and just repeats
Agreed. We can read the books/comics they inspire instead. That outta teach 'em...
This video should be required viewing worldwide
Accountants and lawyers ruin everything.
I think that a general audit is in order, conducted by the a firm appointed by the stockholders.
Was interested, now left completely unsurprised
Great job!
I love how you promoted the patron, then immediately throw patrons under the bus by saying Mack Weldon is responsible for this episode. Over two minutes for selling out, less than 20 seconds for your base. Good job. 👎👎 You earned them.
Disney decided that the film John Carter was going to be a bomb, and so they added production costs from films dating back to the 70's . So it had not chance .
SHUT HOLLYWOOD DOWN. That town needs to be cleaned up, badly. We all now know that Mel Gibson was correct on all accounts of Hollywood, despite his words not agreeing with our politeness, the 'special interests' lawyers and culture-propagandists.
You know, now it makes so much sense how Billy Madison Productions is able to sing on so many big names, in particular all his friends, despite the low budgets and likely lower pay offered, they actually get paid.
Reminds me of a joke.
A company is hiring a new accountant. Three people apply and attend for interview.
The first accountant comes in. The interview board discuss his experience and look at his CV. Finally they hand him a piece of paper with some account details on it.
"Using these figures, calculate how much tax we should pay" they ask.
Pulling out his calculator the first accountant taps away and a few seconds later then shows the result to the interview board.
"Very good, that was amazingly fast. It will take a lot to beat that." the board say. And the interview ends.
The second accountant enters. like before, they discuss his experience and CV. And then comes the final question.
"Using these figures, calculate how much tax we should pay" they ask.
Pulling out a pencil and paper, the account scribbles away, and in short order, shows his answer to the board.
"Amazing, All done in your head. Certainly you are very skilled" they say. And the interview ends.
Finally the last accountant enters. As with the last two interviews, experience and CV are discussed, and again the question asked.
"Using these figures, calculate how much tax we should pay" they ask.
The accountant looks at the paper, smiles, leans forward and says
"How much do you want to pay?"
As an accountant I can assure you this is not just done in Hollywood, this is pretty much standard its just that Hollywood doesn't have to show a profit
Awesome how he was genuinely excited about the cooler #enjoythelittlethings
This is one of the most disgusting thing I've seen in a long time. Not only the extreme greed but the fact Hollywood is so easily able get away with all of this. Its all just so horribly corrupt and broken it makes me sick.