Big growth likely for Georgia's film industry (Atlanta, Perry: sales, 2014)

[LynnHarris]

A few years ago, Georgia was locked in a bidding war with North Carolina over the Disney movie, "The Last Song," starring Miley Cyrus.

Both states wanted the movie to film in their state, and North Carolina was close to sealing the deal with an attractive tax incentive package. But Georgia snapped up the production, largely because it had recently expanded its own tax credit for films.

The state hasn't looked back since...

Big growth likely for Georgia's film industry | www.accessatlanta.com

[LynnHarris]

"Georgia's filming industry has generated an economic impact of $3.3 billion during fiscal year 2013, the Georgia Film, Music & Digital Entertainment Office announced Friday.

That time period covers July 1 of 2012 to June 30 of 2013..."

Full Story: Georgia's film industry generates $3 billion+ in 2013 | The Buzz | www.accessatlanta.com

[Nanosolar]

While I greatly favor the tax credit, is there any evidence the state is getting something out of this money beyond 'some' brand recognition? Improved education, infrastructure, etc?

[tikigod311]

Fantastic! Just drove by Pinewood Studios, it is coming along quickly and looks good.

[LynnHarris]

Originally Posted by Nanosolar

While I greatly favor the tax credit, is there any evidence the state is getting something out of this money beyond 'some' brand recognition? Improved education, infrastructure, etc?

I am curious about this too...

[Newsboy]

Originally Posted by Nanosolar

While I greatly favor the tax credit, is there any evidence the state is getting something out of this money beyond 'some' brand recognition? Improved education, infrastructure, etc?

The state is getting $3.3 BILLION in business that it wouldn't otherwise have. The max amount of the tax credit is just 30%. That means that at a MINIMUM, 70% of the taxes due on that $3.3 billion investment is coming back to the state.

Why is this so hard for people to understand?

[Nanosolar]

Where is the $3.3b number coming from? It said films made in GA spent $933.9 million. Are they including plane tickets bought, etc? $2b worth...?

[cwkimbro]

Originally Posted by Nanosolar

Where is the $3.3b number coming from? It said films made in GA spent $933.9 million. Are they including plane tickets bought, etc? $2b worth...?

Economic impacts include multipliers

A dollar doesn't just sit in our pockets. It is passed around being used again and again.

If you pay someone to do something, they will take that money home and use it one something.... often something bought in-state. This then puts the dollar in the hands of another person or company that must spend it to keep their business going...

etc....

All of the construction in sound stages generate more economic activity when they each construction firm pays for raw materials, labor, etc...

The cash passes hands several times before the facility is actually built. While there is one physical dollar, it passes hands enough that it contributes 3-4 dollars to our states yearly GDP.

[Newsboy]

Originally Posted by cwkimbro

Economic impacts include multipliers

A dollar doesn't just sit in our pockets. It is passed around being used again and again.

If you pay someone to do something, they will take that money home and use it one something.... often something bought in-state. This then puts the dollar in the hands of another person or company that must spend it to keep their business going...

etc....

All of the construction in sound stages generate more economic activity when they each construction firm pays for raw materials, labor, etc...

The cash passes hands several times before the facility is actually built. While there is one physical dollar, it passes hands enough that it contributes 3-4 dollars to our states yearly GDP.

Also, what a lot of people fail to realize is that these are INCOME tax credits, not breaks on sales tax, etc. As anybody who is in business knows, corporations pay tax based on their sales and profits -- i.e. "Corporate Income Tax." A TV or film production company doing business in Georgia and spending at least $500,000 on a single production can earn a 20 percent credit (or 20 percent off) every dollar of income tax they owe. If they include the GA Peach logo in their credits, they get an extra 10 percent credit. So a company that owes $100,000 in taxes on income is only liable for $70,000. Get it?

Now here's where things get complicated: At the state level, these taxes are generally paid and imposed in whatever state the corporation is based. Obviously, except for Tyler Perry and perhaps Turner, few TV and film production companies are incorporated in Georgia. Therefore, they probably don't owe any (or very little) Georgia corporate income taxes. But they DO owe it in whatever state in which they are incorporated, most likely New York or California. For that reason, Georgia allows film companies doing business in the state to TRANSFER (sell) their tax credits to Georgia-based corporations, which then apply the credits to their own income tax burdens. In other words, production companies can actually MAKE MONEY by filming in Georgia.

As CWKimbro explained, this has a multiplier effect: The revenue from these film tax credits is guaranteed to stay in the state, it boosts local businesses who reinvest the money in Georgia capital, and it trickles down to the little man.

Again, it really is a brilliant concept and a win-win. If you eliminate the film tax credits in Georgia, you'll hurt a lot more people than just the entertainment industry.

[LynnHarris]

Will Movie Biz Boom Continue In Peach State, Atlanta?

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