03/22/2012 10:40 EDT | Updated 05/22/2012 05:12 EDT

New Brunswick producers say they can relate to Saskatchewan over tax credit cuts

REGINA - Those in New Brunswick's film industry say they can relate to their counterparts in Saskatchewan, who saw a film employment tax credit cut in this week's provincial budget.

Provincial officials in Saskatchewan say the move will save up to $3 million this year and $8 million annually after existing credits are paid out.

New Brunswick saw its own tax credit cut about a year ago, but nine months later the province reversed the decision and incentives were restored.

Producer Tony Whalen says the film industry in his home province of New Brunswick was devastated when it first happened.

He says what was most important was re-educating the public to explain the tax credits weren't money out the door but an investment.

He says they had to show the film industry created jobs for people, who then stayed in hotels or bought equipment and materials for movie sets.

But what he credits for bringing back the tax credit was public outcry and conversations with political leaders.

“Part of what we did, too, was we made the case that the film industry is a business where a dollar spent in that industry can spin off anywhere from five to ten dollars,” said Whalen.

New Brunswick’s film industry is a third the size of that in Saskatchewan.

Virginia Thompson, who produced the hit TV comedy "Corner Gas" when it shot in Saskatchewan, has said cancelling the tax credit will be devastating to the province's film and TV industry.

“It even means if we ever wanted to do something special with `Corner Gas' we couldn’t shoot that in Saskatchewan because Saskatchewan isn’t supporting film and television,” Thompson said.

Industry representatives have argued that $100 million worth of provincial investment has reaped $600 million in economic activity.

"We're not talking about a hand-out," said Karmafilm founder Anand Ramayya on Thursday. "We're talking about a small investment to see a large return. That's what we've done consistently."

Culture Minister Bill Hutchinson said the province has tried to make it work but the government believes the industry just can't sustain itself.

“Despite our best efforts and efforts of the people in the industry itself, it just hasn’t worked out that way," he said. "Instead of growth, they’ve experienced decline."

"Corner Gas" star Brent Butt tweeted Thursday that he thought the cancellation of the tax credit was unfortunate but added he is "not good at math and politics."