by T.A. DeFeo

 

Georgia officials pride themselves on the state’s tax credits for the movie industry, but a leading economist says the tax credits don’t benefit the state.

“There’s nothing politicians love more than jocks and movie stars,” Kennesaw State University economist J.C. Bradbury told The Center Square. “That’s why they give out a lot of subsidies for sports stadiums, and film and movie credits are also something that are often given out.

“I think there are some political advantages to doing so,” Bradbury added. “One is that political scientists have done some work to demonstrate that people tend to view economic development policy favorably and so they’ll support it because they think voters will like it. But at the same time, movies provide celebrities and so access to celebrities and parties are things that politicians like.”

According to the Bureau of Labor Statistics, Georgia saw the most job gains of any state from the motion picture and video industries between 2011 and 2021, as the number of jobs increased by 15,611. Bradbury said Georgia gave away $6.5 billion in film tax credits during the same years, meaning the jobs, which aren’t full-time, came at the cost of more than $416,000 per job.

“It’s one of those things that goes across party lines,” Bradbury said. “Democrats might argue, ‘oh this is a good public works program; we’re helping stimulate jobs by helping fund this program,’ and Republicans will say things like, ‘oh, well, we’re giving tax breaks; …we’re lowering taxes’ when neither of those things are really true. What they’re doing is just handing money over to Hollywood.”

A spokeswoman for the Georgia Department of Economic Development did not respond to requests for comment.

At times, Georgia’s relationship with Hollywood has caused problems. For example, Hollywood threatened to boycott producing films in the state after Gov. Brian Kemp, a Republican, signed House Bill 481, the Living Infants Fairness Equality Act, which bans most abortions after about six weeks.

But those threats faded from the headlines even as the state’s ban went into effect.

“Even if you want to view politicians extremely cynically, I think that it should be obvious how poor these policies are for economic development,” Bradbury said.

“…If we want to spend money to stimulate jobs — and I use that term loosely — but if we want to use public spending in a way we think that will have a positive return on investment, fixing things like roads and bridges or education or healthcare probably have much higher returns than giving it to film movies,” Bradbury added.

Legislators in other states have changed or eliminated their refundable tax credits for films. However, Bradbury said Georgia’s transferable tax credit obscures the actual cost of the incentives.

“That’s what makes the Georgia program so durable and successful as a political entity,” Bradbury said. “It’s not transparent or easy to see how costly it is to the state.”

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T.A. DeFeo is a contributor to The Center Square. 
Photo “Photographer” by Kaique Rocha.