The film industry in Georgia has turned film credits into its ace of spades. Over the past dozen years, the state has leveraged its lucrative incentives to become the third-largest film and television production center in the United States, only after California and New York. This rapid growth came after the introduction of a generous film tax credit system in 2008, which has continued to be an attractive benefit to filmmakers and production companies globally.
However, in a surprising turn of events, a bill that would significantly reduce these tax credits was dropped by Georgia’s lawmakers. This unexpected move resulted in countless debates within the film industry. Many fear that reducing or altogether eliminating these credits could discourage film and TV production in the state and, consequently, translate into a negative impact on the economy.
Georgia’s film tax credit program grew from a $141 million industry in 2007 to a whopping $2.9 billion industry in 2019. This bill’s introduction was seen as the state’s strategy to build a sustainable film and TV industry. It worked, transforming the state into a hotspot for award-winning productions like “The Walking Dead,” “Stranger Things,” and “Black Panther” to name a few. The availability of infrastructure, crew, and ancillary businesses combined with the attractive tax incentive made Georgia an appealing destination for filmmakers.
The tax credit provided a 20% credit on productions that spent at least $500,000 in the state and essentially created a booming industry. It also offered an additional 10% credit if the finished product included a promotional logo provided by the state. Over just ten years, film and television productions in Georgia increased from 197 to 399, reflecting the influence of these credits.
Nonetheless, the downside has been the mounting cost to taxpayers. Studies showed that every dollar of credit cost taxpayers 92 cents, while the state was only recouping 28 cents on the dollar. Audits flagged the program for increased scrutiny and potential misuse, thereby sparking a debate on the genuine value of these tax credits.
The majority of states in the U.S. offer some form of incentive to film and television productions, but none have been as generous as Georgia. These incentives were designed to lure productions into the state and boost local economies. So, the drop of the bill and the potential removal of Georgia’s tax credits has caught many by surprise and left others concerned.
The fear, as expressed by some industry insiders, is that the monumental growth seen in the state’s film industry could reverse if the tax incentives are phased out. Producers may choose to take their big-budget films elsewhere, where the cost of production would be significantly cheaper due to the availability of tax incentives.
However, others argue that Georgia’s mature film and television industry has already established itself significantly and can continue to thrive without the tax incentives. A strong argument backing this viewpoint is the well-developed infrastructure specially built for film and television production in Georgia, which would still be an attractive feature for filmmakers, irrespective of the lack of tax credits.
The decision is being seen as a high-stakes gamble that could profoundly impact the future of the industry in the state. If documented reports are to be believed, the billion-dollar tax credit drew not just films and TV shows but also an influx of businesses like construction, hospitality, and restaurants – all of which heavily depend on the industry’s growth and continuity. Thus, the tax credit’s potential removal could also impact these sectors negatively.
In summary, Georgia’s move to drop its tax credit bill is a bold decision that has the potential to reshape the future of the state’s film and television industry. While there are legitimate concerns, there are also voices of confidence saying that the film industry in Georgia has matured enough to sustain itself without the hitherto offered public subsidies.
As filmmakers, production companies, and industry insiders await the decision’s final unfolding, the question remains: will the removal of these tax incentives be the end of Georgia’s reign as a film and television production hub, or will it be the beginning of an industry mature enough to stand on its own without staggering public subsidies? Time alone will provide the answer to this compelling question. For now, though, the eyes of the world remain firmly focused on Georgia.
