Georgia has failed to pass a bill to cap its film and TV tax credit, the largest in the nation, after the House and Senate could not reach an agreement. Lawmakers have been working on proposals for nearly a year to rein in the incentive, but will have to wait until the next session in January 2025 to address the issue. The failure to pass a bill is a relief for the Georgia film industry, which heavily relies on the incentive and was closely watching the legislation. The outcome is seen as a sign that Georgia is still “open for business” by the Georgia Screen Entertainment Coalition.
The state offers a 30% credit on film and TV production costs, which has been used to subsidize many productions, making Atlanta a major production hub. With no limit on the total amount of credits that can be issued annually, the program has surpassed $1 billion in recent years. Concerns have been raised by lawmakers about the financial risk this poses to the state. In February, the House passed a measure to cap the amount of credits that could be bought and sold each year, but faced resistance from studio facility owners who feared it could impact their ability to sell credits.
The Senate attempted to address concerns by approving a cap with exceptions for projects shot at three large production facilities, which raised concerns for smaller studio facilities. This led to a lack of consensus between the houses, ultimately resulting in the bill being dead at the end of the session. The House tried to salvage the measure by amending it to trigger the cap only in cases of severe economic downturn, but the Senate did not take up the bill. The Senate version also included a provision to tax residual compensation, which was controversial.
The failure to pass a bill to cap the tax credit is seen as a victory for the Georgia film industry and a sign that the state remains supportive of the industry. The credit has helped attract major productions to Georgia and transformed Atlanta into a major production hub. Lawmakers have expressed concerns about the financial risk posed by the program, but have been unable to reach a consensus on how to address it. The lack of agreement between the House and Senate ultimately led to the bill being dropped for the year.
The House attempted to salvage the measure with a new version of the proposed cap, but the Senate did not take up the bill. The Senate version included a provision to tax residual compensation, which was also controversial. The failure to pass a bill to cap the tax credit means that the issue will have to wait until the next session in January 2025 to be addressed. Despite the lack of agreement on the issue, the Georgia film industry can continue to benefit from the tax credit, which has played a significant role in attracting productions to the state.
