Do film tax credits work? A New York Times article looks at Michigan’s plan to rejoin this tax credit race to lure film and television production from California. The article cites an evaluation of Georgia’s film tax credit conducted last fall by the Fiscal Research Center (FRC) for the Georgia Department of Audits and Accounts.
The FRC concluded that for every dollar spent on incentives only 19 cents were returned, in line with other similar studies like one from New York, with a return between 15 and 31 cents. Despite these results, evaluations like these are politically contentious, as the article notes: “Outside experts say that the effects of such spending are overstated and that the initiatives are incredibly costly for state governments. But their academic papers are competing against the promises of lobbyists and the allure of Hollywood stars and exclusive parties.”
Read the FRC’s report here: Film Tax Credit
The Film Tax Credit (O.C.G.A. §48-7-40.26) was enacted in 2005 to promote investment in film, television, and digital media projects. Currently, the credit is available to production companies with a minimum of $500,000 in qualified spending in Georgia. Companies can apply for and receive a credit for 20 percent of eligible production expenditures with an additional 10 percent available to companies that offer Georgia marketing opportunities.