LOS ANGELES, USA - JANUARY 25, 2019: A view of the Hollywood Sign on the Hollywood Hills. Valery ... [+]
Walt Disney and Netflix, which have threatened to cut ties with Georgia over the state’s recently enacted draconian abortion restrictions, have gotten a pretty sweet deal from the Peach State courtesy of the state’s taxpayers.
Producers of movies and television shows can get a 20% tax credit if they spend $500,000 or more on production or post production. They can earn an additional 10% in tax breaks by including a Georgia Film Commission logo on approved projects along with a link to ExploreGeorgia.org/Film on the project's website. Two Georgia cities, Columbus and Savannah, sweeten the pot further with incentives of their own.
Giving Hollywood a helping hand isn’t cheap. The state doled out $800 million in tax credits to movie and television productions in 2017, the latest data available, according to Georgia’s governor’s office. That’s roughly a tenfold increase from 2009, the first year when the current incentives were in place. Over the past decade, Georgia has doled out more than $4 billion in tax credits to Hollywood.
“The irony of the situation is that the filming ban, which I support, will probably actually save the Georgia government more money than the loss of the film revenue will cost them,” Victor Matheson, an economist at the College of the Holy Cross, writes in an email. “The same was true for the NCAA bans on championships in North Carolina and other states in the wake of Confederate flag controversies and anti-LGBTQ legislation. The sports and film industries have done such a good job exaggerating their economic impacts that boycotts become effective symbolic tools even though they have almost no real impact.”
Economists have argued for years that tax breaks for Hollywood are a waste of money. Research by USC Professor Michael Thom in 2016 found that the only benefits from the incentives were the wage gains enjoyed mostly by people working in the industry. The Motion Picture Association of America, which vehemently disputes Thom’s findings, estimates that Hollywood is “responsible” for 92,000 direct and indirect jobs in the Peach State.
Georgia has 1.1 million square feet of purpose-built sound stage and 1.2 million of retrofitted sound stage along with dozens of warehouses. Until 2010, the state had one purpose-built sound stage—Riverwood Studios in Senoia—that had 45,000 square feet of sound stage. According to FilmLa, 15 of the top 100 grossing films of 2018 were filmed in Georgia, the most of any state.
Unlike other states, Georgia has never released a comprehensive review of its film/TV incentives, although one is in the works by Alfie Meeks, director of Georgia Tech’s Center for Economic Development Research. Other states, including California, have conducted reviews for years and instituted caps to minimize the losses. Meeks didn't respond to a request for comment.
