Article from FBTFilm.com
Itâ€™s official! Louisianaâ€™s movie tax credit incentives are here to stay. State officials increased the tax credit percentages from 25 to 30% and effective July 1, 2009, Louisiana’s film tax incentive program has been granted permanent status.
The combination of Louisiana increasing film tax incentives from 25 â€“ 30% and the new, permanent status of the program offers a positive future for the fast-growing local film industry. It also signals a strong message to film producers that Louisiana is committed to remaining competitive by eliminating any concerns about a â€œphase outâ€ of the program in the future.
State officials also hope that the new, permanent status will encourage more investment in production support assets such as sound stages and studios as well as schools which continue to train the local film workforce.
Louisiana was one of the first states to enact a film tax credit, which provides tax incentives to out of state producers who make movie, film and entertainment projects in the state. The act also provides additional incentives for producers who hired local workers on their film productions.
Important factors in making Louisiana film tax credits permanent
The film tax incentive program was created in 2002 and had reached its â€œsunsetâ€ date in 2008 when lawmakers were forced to re-visit the program, which had been given credit for helping turn Louisiana into one of the top film production locations in the US. With the economic downturn of 2008 and lawmakers looking to carefully manage budgets, the renewal couldnâ€™t have come at a more difficult time.
At the same time other states such as Michigan and Georgia had begun offering similar tax credits but at higher levels, hoping to woo film makers with more lucrative incentives. The heightened competition has fueled concerns about a financial â€œarms raceâ€ of states trying to outbid each other.
However it didnâ€™t take long for Louisianaâ€™s lawmakers to approve an increase in the tax incentive level from 25 â€“ 30% as well as make the program permanent. The fact is that the film industry has become a giant economic engine for Louisiana â€“ generating more than an estimated $2 billion in total economic impact since the programâ€™s inception. This includes as much as $200 million in payroll for Louisiana workers.
The state film office has reported record numbers for 2007 and 2008 both in terms of number of productions, tax incentives issued and revenue generated. This impact is spread throughout the state from New Orleans to Shreveport and Lake Charles thus benefitting all of Louisiana.
Film and Louisiana â€“ a natural fit
It would seem that other states trying to â€œout bidâ€ Louisiana for film business may have underestimated other factors such as workforce, infrastructure and shooting locations. A recent article reported that Massachusetts has lost almost $100 million to tax breaks and may have a loss up to $250 million for 2009.
Not far away – the “Made in New York” tax credit is facing a different sort of challenge – running out of cash. On July 2, 2009 the Mayor of New York announced that the program had officially “reached it’s full allocation” meaning that the program had exhausted it’s funds and would have no funds available for the remainder of 2009.
One of the big factors in the success of the film industry in Louisiana is the availability of a highly trained workforce to support film productions as well as an abundance of great, unique locations from which stories can be told. Many companies are also investing in new, state of the art sound stage and production facilities. Add in the film tax credits and Louisiana is tough to beat as a film production destination.