Rome Reporter

Georgia lawmakers are reevaluating the state's generous film tax credits, raising questions about the fairness and fiscal impact of the incentives in the burgeoning film industry. As Georgia maintains its reputation as the "Hollywood of the South," a debate on the tax credit's future is set to unfold in the upcoming legislative session.

The Joint Tax Credit Review Panel, co-chaired by Senator Chuck Hufstetler and Representative Shaw Blackmon, held its fourth meeting at Athens Technical College in Georgia to examine the state's film tax credits. During the meeting, industry experts provided a thorough review of Georgia's film tax credit, highlighting its impact on the state's economy and businesses, and offering recommendations for potential enhancements while emphasizing the need for fiscal accountability and competitiveness.

"In a press release, Senator Chuck Hufstetler (R – Rome) said: 'After hearing from experts on Georgia’s film tax credit incentives, it is evident that the film tax credit impacts our state, local economies and businesses large and small. We have received insightful testimony from various presenters about the legislative history and details of the tax credits. They also offered recommendations for enhancing the film tax credits in the future. However, as legislators we must prioritize transparency, make smart financial decisions and ensure Georgia remains competitive. We must also analyze the fiscal ROI (Return on Investment) of all our credits. I want to thank our witnesses, panel members and Athens Technical College for hosting this meeting and I look forward to continuing the analysis of our state tax credits.'"

According to Atlanta News First, the incentive grants a 30% tax reduction to production companies that choose to film in Georgia, contributing to the significant growth of the film and production industry, solidifying Georgia's position as the "Hollywood of the South." In the coming year, Georgia expects to host a comparable number of productions, fostering the creation of an estimated 59,000 additional jobs within the industry.

Statements at the hearing were provided by various entities including the Georgia Department of Revenue, Bennett Thrasher (an accounting firm based in Cobb County), Americans for Prosperity, Olsberg SPI Ltd (a London-based business management consultant), Trilith Studios, Gray TV Assembly Studios, and Georgia State University.

Atlanta First News further reported that initially starting at 10% in 2005, the tax credits were later increased to a maximum of 30% in 2008, offering production companies more substantial write-offs. However, tax professionals emphasized during the hearing that the application process for these credits is challenging, with a CPA conducting state tax audits labeling Georgia's procedures as the most rigorous among states with similar incentive programs.

During the hearing, Senator Chuck Hufstetler said, "Any business in Georgia that you pay 30% of their costs, they’re probably going to do well. [The industry] is vibrant, it’s grown in Georgia, but we have to say, what is fair to everybody? There are other businesses they can grow too."

Legislators during the hearing generally agreed that while the industry is driving economic growth and employment, it's not without its drawbacks citing that Georgia experienced a loss of over a billion dollars in tax revenue as a trade-off.

According to Family Life Magazines, "The 391 film and television productions that were made in Georgia created another record year of $2.9 billion in direct spending, supported 3,040 motion picture and television industry businesses, and delivered $9.2 billion in total wages."

According to the Georgia Department of Economic Development, the state has 4 million square feet of stage space with ongoing facility expansions.