- Georgia lawmakers unveil proposal to curb film and TV tax incentive
- Georgia boasts largest production tax credit in the country
- Legislation aims to limit credits transferred and establish stricter requirements
- Industry stakeholders studying the bill and raising concerns
- Lawmakers seek to balance state finances and industry growth
After eight months of careful study, Georgia lawmakers have introduced a proposal to rein in the state’s thriving film and TV tax incentive. With a staggering $1.24 billion in credits certified last year, Georgia currently boasts the largest production tax credit in the country. While the incentive has led to the growth of soundstages and the influx of numerous productions, concerns have been raised about its impact on state finances and the ability to cut income taxes. The newly unveiled legislation aims to address these concerns by limiting the amount of credits that can be transferred and establishing stricter requirements to claim the full amount.
Limiting Transferable Credits
Under the proposed bill, named HB 1180, the amount of tax credits certified by the state would not be capped. However, there would be a limit on the ability of productions to monetize these credits. The bill would restrict the amount that can be sold in a year to 2.5% of the state’s estimated revenue, which equates to $902 million for the upcoming fiscal year. This limitation seeks to smooth out the redemption of credits and prevent the state from facing a sudden and overwhelming liability. While the bill does not directly cap the program, it effectively limits its size.
Industry Stakeholders’ Response
The Georgia Screen Entertainment Coalition (GSEC), representing studios, production facilities, and other industry stakeholders, is currently studying the bill. Executive Director Kelsey Moore stated that they will work closely with legislators to protect the program, which has played a significant role in building a Georgia-based film industry and generating billions of dollars in economic impact. However, the bill is expected to face a barrage of lobbying and potential amendments as it goes through the legislative process.
Striking a Balance
Lawmakers behind the legislation emphasize their intention to use taxpayers’ dollars effectively and efficiently. State Senator Chuck Hufstetler, speaking at a press conference, stated that the goal is to balance the interests of the state and the industry while encouraging continued growth in Georgia. By establishing stricter requirements for claiming the full amount of credits, such as crew and vendor percentages, spending thresholds, and studio usage, lawmakers aim to ensure that the incentive benefits the state and its residents in a meaningful way.
The proposed legislation to limit Georgia’s film and TV tax incentive marks a significant step in addressing concerns about its impact on state finances. While the bill does not cap the amount of tax credits certified, it places restrictions on their transferability and establishes stricter requirements for claiming the full amount. The bill’s fate now lies in the hands of the legislature, with potential lobbying and amendments expected along the way. As the debate unfolds, it remains to be seen how Georgia will strike a balance between supporting the thriving film industry and safeguarding the state’s financial interests.