(TRENTON) – Legislation sponsored by Assemblyman Gordon Johnson (D-Bergen) to expand New Jersey’s film and digital media production tax credit program to help generate jobs and revenue was released Thursday by an Assembly panel.
The bill (A-2562), designated as the “Garden State Film and Digital Media Jobs Act,” would enhance the corporation business tax and gross income tax credits for qualified film and digital media content production expenses, revise and expand film and digital media tax credit eligibility requirements, and require the New Jersey Economic Development Authority (EDA) to study the prospect of developing a film production studio at a North Jersey location.
“These industries help generate jobs and contribute significantly to local economies,” said Johnson. “The state missed the mark when it suspended the credit. There is no reason why New Jersey should not be taking advantage of the same opportunities that are creating jobs and bringing millions in revenue to other states. This bill will reposition New Jersey as a contender so we can once again attract film and digital media productions that have contributed to our economy in the past.”
The bill (A-2562), designated as the “Garden State Film and Digital Media Jobs Act,” would enhance the corporation business tax and gross income tax credits for qualified film and digital media content production expenses, revise and expand film and digital media tax credit eligibility requirements, and require the New Jersey Economic Development Authority (EDA) to study the prospect of developing a film production studio at a North Jersey location.
The bill would enhance the film and digital media tax credits by increasing the incentive value of tax credits that may be claimed for certain qualified expenses. The bill provides that the increased incentive values are permitted to be claimed for qualified film and qualified digital media content production expenses that represent:
- purchases of goods through a qualified business in a urban enterprise zone or purchases of services performed by a resident of an urban enterprise zone (22 percent instead of the current 20 percent);
- wages and salaries of eligible film and digital media student hires employed in the production of a film or digital media content (22 percent instead of the current 20 percent); and
- expenses incurred in an eligible municipality for the production of a film or digital media content (40 percent instead of the current 20 percent).
The bill would also enhance the credits by increasing the annual caps that limit the total amount of film and digital media tax credits awarded each fiscal year. The bill provides that in 2016, and in each fiscal year prior to 2023, $50 million in credits may be awarded to eligible taxpayers for qualified film production expenses (currently capped at $10 million per year), and $10 million may be awarded to eligible taxpayers for qualified digital media content production expenses (currently capped at $5 million per year).
The bill was released by the Assembly Commerce and Economic Development Committee.