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Started By
Message
re: Why did Georgia’s film industry crush it so hard but Louisiana’s crumbled?
Posted on 7/20/20 at 12:12 am to YF12
Posted on 7/20/20 at 12:12 am to YF12
quote:
For every dollar of film tax credit granted, the audit found that Georgia generates approximately 10 cents in revenue.
And without the grants, the state makes $0 in revenue.
1
Posted on 7/20/20 at 12:12 am to Giantkiller
Answer: Democrats
Next question.
Next question.
Posted on 7/20/20 at 12:16 am to rowbear1922
quote:
And without the grants, the state makes $0 in revenue.
lol no
They are almost 2 billion dollars behind on outstanding credits because that is not how government works
Its easy to write a 200 million dollar credit
Its much harder to collect the revenue you were promised behind it
Georgia allows you to sell and transfer film tax credits to offset Georgia tax liabilities
They are losing a frick ton on this
This post was edited on 7/20/20 at 12:20 am
Posted on 7/20/20 at 12:22 am to rowbear1922
quote:
The state is not "giving it away". They don't charge the films some of the taxes to encourage them to film here. So let's say in the course of a film, they were supposed to pay $10M in taxes. The state basically says, "hey, if you film here, we will only charge you $5M in taxes".
You and most of this board are incorrect and are spreading false information.
A better summary of how the tax "credits" work is this:
The film industry was supposed to pay $1m in taxes and the state says to the citizens (you and I) "if you pay the film industry $10m then I will forgive $11m of what you owe the state."
Posted on 7/20/20 at 12:30 am to BeepNode
quote:
The film industry was supposed to pay $1m in taxes and the state says to the citizens (you and I) "if you pay the film industry $10m then I will forgive $11m of what you owe the state."
Its more like the state gives a 20% film credit for a 100 million dollar movie.
That is 20 million dollars
In Georgia, that production company will sell off the credits to people for just under the total value and those people can use them to offset their Georgia state tax liabilities
You will never collect in revenue the 20 million dollars of credits you just put on the open market that would require almost double the total budget of the film staying in Georgia.
This post was edited on 7/20/20 at 12:31 am
Posted on 7/20/20 at 12:40 am to YF12
quote:
lol no
They are almost 2 billion dollars behind on outstanding credits because that is not how government works
Its easy to write a 200 million dollar credit
Its much harder to collect the revenue you were promised behind it
Georgia allows you to sell and transfer film tax credits to offset Georgia tax liabilities
They are losing a frick ton on this
LINK
quote:
To calculate your tax credit, simply multiply your qualified Georgia expenditures by .20. For example,
for a base investment in georgia of $20,000,000,
your savings would be $4,000,000. If you include the georgia Entertainment Promotion (gEP) in the finished project, your credit would be at the 30 percent level, or 20,000,000 x .30 = $6,000,000 in georgia tax credit! Keep in mind that you may use this credit against your georgia income tax liability, or you may transfer (sell) it to any georgia taxpayer.
It's a tax credit; not a checkbook.
If you read the link, it's for projects filming in Georgia and spending a minimum of $500,000 in Georgia on Georgia expenses.
ETA: Again, if you don't have the project, you get $0.
This post was edited on 7/20/20 at 12:41 am
Posted on 7/20/20 at 12:44 am to rowbear1922
quote:
ETA: Again, if you don't have the project, you get $0.
And many times if you have the project you get negative money
The tax credits in Georgia for this are able to be sold to anyone. Businesses, individuals, etc
Unless Georgia state taxes are 20%-30% this means they will lose money to out of state production companies essentially every time because they come in and do it all in Georgia, they sell the credits and they all leave
This post was edited on 7/20/20 at 12:47 am
Posted on 7/20/20 at 12:49 am to YF12
quote:
That is 20 million dollars
In Georgia, that production company will sell off the credits to people for just under the total value and those people can use them to offset their Georgia state tax liabilities
There’s a discount market for Georgia tax credits? Where do you access this? This seems like bonus money to production studios
This post was edited on 7/20/20 at 12:50 am
Posted on 7/20/20 at 12:54 am to YF12
I can tell you first hand the economic boom the film industry had for Baton Rouge. Once the state capped the tax incentive, we saw a fraction of the films in BR. During filming, we always had crew members and some of the actors in the restaurant. They all had to live, eat, etc here in town which benefitted the whole city.
I don't know all about the Georgia tax credits, but I know it hurt Baton Rouge and the whole state once they capped the tax credits.
I don't know all about the Georgia tax credits, but I know it hurt Baton Rouge and the whole state once they capped the tax credits.
Posted on 7/20/20 at 12:55 am to DiamondDog
quote:
There’s a discount market for Georgia tax credits? Where do you access this? This seems like bonus money to production studios
I mean entire firms do this
See this
https://www.monarchprivate.com/monetize-credits/monetize-state-credits/monetize-film-entertainment-tax-credits/georgia-film-entertainment-tax-credit/
Last I saw you can offset your Georgia state tax liability for about 90 cents on the dollar
Not bad way to save some money
Posted on 7/20/20 at 12:57 am to rowbear1922
I remember when Celtic Studios was a hot thing. Probably not so much anymore I’m guessing.
Posted on 7/20/20 at 1:01 am to rowbear1922
quote:
It's a tax credit; not a checkbook.
You don't understand what a transferable tax credit is.
Let's say your neighbor makes $100k and owes $5k in state taxes and he gets a transferable tax credit for 25% of his income.
You may think that your neighbor is simply not paying $5k in taxes, but that's not reality at all. Your neighbor can then take the remaining $20k in tax credits and sell them in the open market for $18k. He will net $18k more than he owed in taxes.
Now, the state technically doesn't have to write a check, as you put it (although Louisiana literally did write checks) but that doesn't make the tax credits any less of a giveaway.
What the state has done is told everyone in your neighborhood that they need to give your neighbor $18k and in exchange they will forgive $20k of your taxes.
In the film industry it seems fairly benign but in other industries it is downright demoralizing. It makes you want to leave the state as a local tech company when you have to pay big competitors to set up shop in your back yard.
This post was edited on 7/20/20 at 1:02 am
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