Movie Tax Write-Downs Help Studios Profit at Public’s Expense

The recent decision by Warner Bros. Discovery Inc. to shelve and write down a completed film stirred up a significant backlash following a mixed third-quarter financial report, after which Warner Bros. decided to shop the film to other distributors.

Warner Bros. isn’t alone in attempting to write down “Coyote vs. Acme”—many films and productions have taken similar routes. The practice of receiving tax incentives for film production only to ultimately write down, or write off, the production takes public money from states and ...