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The Georgia House has just approved HB1180, legislation closely followed by the entertainment industry as it alters elements of the transferable tax credit that’s drawn film and television production to the Peach State for the last 15 years — capping the amount that can be transferred in any one year. The change would impact any company or producer that isn’t resident in Georgia.
The bill now heads to the Senate, then to the governor’s desk and prevailing wisdom sees it sailing through, as it just did, albeit with some opposition from the floor.
“There’s a saying, ‘If it’s not broke, don’t try to fix it.’ We have grown to the third in the word [in production] because we do not have a cap. Other states are looking at removing their caps. They are looking at what drives the industry, and they are trying to mirror that,” said Rep. Long Tran.
Rep. Betsy Holland warned, ‘The people we will hurt are not the Bob Igers or the David Zaslavs of the world. The people we will hurt are Georgians – carpenters, caterers small mom and pop vintage clothing stores that have grown three times to serve the film industry.”
The bill, which would take effect starting in 2026, limit annual tax credit transfers to 2.5% of the state budget, which would come to about $900 million at current levels. Eligible transfers above the limit one year would be honored the next — so it’s not an absolute cap. It does create uncertainty, critics say.
Neither Hollywood nor Georgia sound stage-owners wanted this of course, preferring the unlimited status quo. Studio executives have been on the ground working closely with and in the state to end up with something feasible. Is it? “It will still be a desirable place to shoot,” said one studio insider.
We are confident Georgia will maintain its position as a top choice for film and television production. Throughout the legislative process, Georgia House legislators have shared their intent to support the film industry with a stable film tax incentive that is viable for the long term,” Kelsey Moore, Executive Director of Georgia Screen Entertainment Coalition.
The $900 million is a big number and it will grow along with the budget, which has increased about 7% annually over the past five years. Productions still seek out Georgia for the crews and infrastructure, which has grown rapidly, some say. That includes a skilled crew base living in Georgia, many trained there under a program called the Georgia Film Academy, which has launched programs at high schools and colleges around the state. Opponents said the bill could limited opportunities for the young people in these programs.
The cap on tax credit transfers only impacts productions by out-of-state entities that can’t use the Georgia tax credits so sell (transfer) them to local high-worth individuals or businesses in what’s become a booming market. Georgia-based studios like Tyler Perry’s, which can use the credits directly and don’t need to transfer them, won’t have a cap.
The bill’s supporters said the state, the revenue department, annual spending and budget planning need visibility and cant have that without an annual cap. The change isn’t punitive, they insist, just provides clarity for the state. It is also a longer-term solution that will keep the the issue of production tax credits from returning to the State House every year. They acknowledge the film industry’s contribution to the state and say they committed to it.
The credits catapulted our state to the forefront of the entertainment industry,” said Rep. Clint Crow. “However, as the industry has flourished, so too have the costs to our state revenue.” He called the bill “a delicate balance.”
Opponents noted that it’s not a great bill for smaller indie films, whose financings can be is based in part on tax credit timing.
How this plays out will depend on the amount of tax credits eligible to transfer in a year; the number of transfer credits producers want to utilize in a year; the amount that can actually be transferred given the new cap; and who claims them first.
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