Bill Text: HI SB2111 | 2012 | Regular Session | Amended
Bill Title: Film Tax Credit; Amendments
Spectrum: Strong Partisan Bill (Democrat 14-1)
Status: (Engrossed - Dead) 2012-04-03 - (H) The committee(s) on FIN recommend(s) that the measure be deferred. [SB2111 Detail]
Download: Hawaii-2012-SB2111-Amended.html
|
THE SENATE |
S.B. NO. |
2111 |
|
TWENTY-SIXTH LEGISLATURE, 2012 |
S.D. 1 |
|
|
STATE OF HAWAII |
|
|
|
|
|
|
|
|
||
|
|
||
A BILL FOR AN ACT
RELATING TO FILM AND DIGITAL MEDIA INDUSTRY DEVELOPMENT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
PART I
SECTION 1. The legislature finds that 2010 was the first $400,000,000 year in direct spending in film and television production in Hawaii and also marked the growth of locally-produced Tetris and massive multiplayer platform Avatar/Blue Mars, and international recognition for Hawaii's human capital with breakout talent ranging from Andy South in fashion, Bruno Mars in music, "The Descendants" author Kaui Hemmings in writing, and Ty Sanga, the academy for creative media graduate, whose "Stones" premiered as the first Hawaiian language film at the 2011 Sundance Film Festival. Also in 2011, CBS Network's remake of the iconic "Hawaii Five-O" series averaged over fourteen million viewers for each episode, represented the season's highest-rated television series among adults 18-49, and was the most digitally recorded series on the air. In 2012, director Alexander Payne's critically-acclaimed film, "The Descendants" has been nominated for best picture, director and actor awards and all of its soundtrack (forty songs) was composed and performed by notable Hawaiian entertainers.
The legislature further finds that the success of the Act 88, Session Laws of Hawaii 2006, production credits in generating additional production work within the State indicates that Hawaii could have a billion dollar industry through the right combination of responsible incentives, dedicated infrastructure, broader development of Hawaii's intellectual property workforce, and a global perspective. The right incentives also represent an investment that bolsters the local economy and provides an international marketing advantage for the State's number one industry, tourism.
The purpose of this Act is to capitalize on the convergence of Hawaii's film, television, entertainment, digital media, and music industries by pursuing long-term growth through a comprehensive strategy to grow high-quality local jobs in these industries. The incentives in this Act are intended to implement the strategy by encouraging the use of Hawaii as a site for filming, for the digital production of films, and to develop and sustain the workforce and infrastructure for Hawaii's film, television, entertainment, digital media, and music industries.
PART II
SECTION 2. The purpose of this part is to:
(1) Establish the Hawaii film and digital media special fund; and
(2) Repeal part IX, chapter 201, Hawaii Revised Statutes, relating to Hawaii television and film development.
SECTION 3. Chapter 201, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§201- Hawaii film and digital media special fund. (a) There is established in the state treasury the Hawaii film and digital media special fund into which shall be deposited:
(1) Appropriations by the legislature;
(2) Donations and contributions made by private individuals or organizations for deposit into the fund;
(3) Grants provided by governmental agencies or any other source;
(4) Fees collected pursuant to section 235-17; and
(5) Beginning July 1, 2013, quarterly payments in an amount equal to two per cent of the total aggregate wages and salaries paid to legal residents of this State pursuant to the requirements of sections 235-17 and 235- .
(b) The fund shall be used for:
(1) The operations of the film and digital media program;
(2) Specific development projects, including but not limited to grants to filmmakers and film festivals, loans, and other programs or activities to stimulate growth of the film and digital media industry; and
(3) Internships, apprenticeships, and training programs that expand the skill sets of Hawaii's workforce and the film and digital media industry."
SECTION 4. Chapter 201, part IX, Hawaii Revised Statutes, is repealed.
PART III
SECTION 5. The purpose of this part is to:
(1) Amend the motion picture, digital media, and film production income tax credit percentages and the total tax credit cap to unspecified amounts; and
(2) Strengthen incentives for hiring greater numbers of residents and to support training and employment opportunities for those residents.
SECTION 6. Section 235-17, Hawaii Revised Statutes, is amended to read as follows:
"§235‑17 Motion picture, digital media, and film production income tax credit. (a) Any law to the contrary notwithstanding, there shall be allowed to each taxpayer subject to the taxes imposed by this chapter, an income tax credit which shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed. The amount of the credit shall be:
(1) [Fifteen]
per cent of the qualified [production costs] expenditures
incurred by a qualified production in any county of the State with a population
of over seven hundred thousand; or
(2) [Twenty]
per cent of the qualified [production costs] expenditures
incurred by a qualified production in any county of the State with a population
of seven hundred thousand or less.
A qualified production occurring in more than one county may prorate its expenditures based upon the amounts spent in each county, if the population bases differ enough to change the percentage of tax credit.
In the case of a partnership, S corporation,
estate, or trust, the tax credit allowable is for qualified [production costs]
expenditures incurred by the entity for the taxable year. The cost upon
which the tax credit is computed shall be determined at the entity level.
Distribution and share of credit shall be determined by rule. Notwithstanding
any provision to the contrary, the credit may be recovered directly by the
entity that incurred the qualified expenditures.
If a deduction is taken under section 179 (with respect to election to expense depreciable business assets) of the Internal Revenue Code of 1986, as amended, no tax credit shall be allowed for those costs for which the deduction is taken.
The basis for eligible property for depreciation of accelerated cost recovery system purposes for state income taxes shall be reduced by the amount of credit allowable and claimed.
(b) The credit allowed under this section
shall be claimed [against the net income tax liability for the taxable
year. For the purposes of this section, "net income tax liability"
means net income tax liability reduced by all other credits allowed under this
chapter.] after all other tax credits available to the taxpayer have
been claimed. A taxpayer eligible to claim a tax credit under this section may
assign all or a portion of a tax credit under this section to any assignee. An
assignee may subsequently assign a tax credit or any portion of a tax credit
assigned under this subsection to one or more assignees. A taxpayer may claim
a portion of a tax credit and assign the remaining tax credit amount. A tax
credit assignment under this subsection shall be irrevocable. The tax credit
assignment under this subsection shall be made on a form prescribed by the
department of taxation. A taxpayer claiming a tax credit under this section
shall submit a copy of the completed assignment form to the department in the
tax year in which the assignment is made and shall attach a copy of the form to
the tax return on which the tax credit is claimed.
(c) If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of credits over liability shall be refunded to the taxpayer; provided that no refunds or payment on account of the tax credits allowed by this section shall be made for amounts less than $1. All claims, including any amended claims, for tax credits under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed. Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.
(d) To qualify for this tax credit, a production shall:
(1) Meet the definition of a qualified production
specified in subsection [(l);] (p);
(2) Have qualified [production costs] expenditures
totaling at least $200,000[;] for a qualified production, or $50,000
for a qualified digital media project or qualified independent and emerging
media project;
(3) Provide [the State, at a minimum, a
shared-card, end-title screen credit, where applicable;] marketing
materials promoting the State as a tourist destination or film and digital
media production destination, when appropriate, at no cost to the State, which shall,
at a minimum, include placement of a "Filmed in Hawaii" or "Produced
in Hawaii" logo in the end credits; and
(4) Provide evidence [of reasonable efforts to
hire local talent and crew; and
(5) Provide evidence of financial or
in-kind contributions or educational or workforce development efforts, in
partnership with related local industry labor organizations, educational
institutions, or both, toward the furtherance of the local film and television
and digital media industries.] that for the first two years of the production
credit, at least fifty per cent, and thereafter, at least sixty per cent, of
the positions that make up the production cast and below-the-line production
crew, or, in the case of digital media projects, at least seventy-five per cent
of the positions, are filled by legal residents of this State, whose residency
is demonstrated by a valid Hawaii driver's license or other state-issued identification
confirming residency, or students enrolled full-time in a
film-and-entertainment-related course of study at an institution of higher
education in the State.
(e) On or after July 1, 2006, no qualified [production
cost] expenditure that has been financed by investments for which a
credit was claimed by any taxpayer pursuant to section 235-110.9 is eligible
for credits under this section.
(f) To receive the tax credit, the taxpayer shall first prequalify the production for the credit by registering with the department of business, economic development, and tourism during the development or preproduction stage. Failure to comply with this provision may constitute a waiver of the right to claim the credit.
(g) The director of taxation shall prepare forms as may be necessary to claim a credit under this section. The director may also require the taxpayer to furnish information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.
(h) Every taxpayer claiming a tax credit under
this section for a qualified production shall, no later than ninety days
following the end of each taxable year in which qualified [production costs]
expenditures were expended, submit a written, sworn statement to the
department of business, economic development, and tourism, identifying:
(1) All qualified [production costs] expenditures
as provided by subsection (a), if any, incurred in the previous taxable year;
(2) The amount of tax credits claimed pursuant to this section, if any, in the previous taxable year; and
(3) [The number of total hires versus the number
of local hires] An estimate of the full-time equivalent positions for legal
residents of this State created by each production, by category (i.e.,
department), and by county.
(i) The department of business, economic development, and tourism shall:
(1) Maintain records of the names of the taxpayers and qualified productions thereof claiming the tax credits under subsection (a);
(2) Obtain and total the aggregate amounts of all
qualified [production costs] expenditures per qualified
production and per qualified production per taxable year; and
(3) Provide a letter to the director of taxation specifying the amount of the tax credit per qualified production for each taxable year that a tax credit is claimed and the cumulative amount of the tax credit for all years claimed.
Upon each determination required under this
subsection, the department of business, economic development, and tourism shall
issue a letter to the taxpayer, regarding the qualified production, specifying
the qualified [production costs] expenditures and the tax credit
amount qualified for in each taxable year a tax credit is claimed. The
taxpayer for each qualified production shall file the letter with the
taxpayer's tax return for the qualified production to the department of
taxation. Notwithstanding the authority of the department of business,
economic development, and tourism under this section, the director of taxation
may audit and adjust the tax credit amount to conform to the information filed
by the taxpayer.
(j) Total tax credits claimed per qualified
production shall not exceed [$8,000,000.] $ .
(k) The director of taxation may revoke or modify any written decision qualifying, certifying, or otherwise granting eligibility for tax credits under this section if it is discovered that the taxpayer submitted any false statement, representation, or certification in any application, record, report, plan, or other document filed in an attempt to receive tax credits under this section. The director shall immediately notify the department of business, economic development, and tourism of any revoked or modified orders affecting previously granted tax credits. Additionally, the taxpayer shall notify the department of business, economic development, and tourism of any change in its tax credit claimed.
(l) A determination by the director of taxation that a taxpayer received tax credits pursuant to this section to which the taxpayer was not entitled is grounds for forfeiture of previously claimed and received tax credits. The taxpayer is responsible for returning forfeited tax credits to the director of taxation, and the funds shall be deposited in the general fund.
(m) A taxpayer that submits fraudulent information under this section shall be liable to reimburse the reasonable costs and fees associated with the review, processing, investigation, and prosecution of the fraudulent claim. A taxpayer that obtains a credit payment under this section through a claim that is fraudulent shall be liable for reimbursement of the credit amount plus a penalty in an amount double the credit amount; provided that the penalty shall be in addition to any criminal penalty to which the taxpayer is liable for the same acts.
(n) No later than December 31 of each year, the department of business, economic development, and tourism shall provide a report for the previous calendar year to the governor and the legislature that outlines the return on investment and economic benefits of the tax credits to the State. The report shall also include an estimate of the full-time equivalent positions for legal residents of this State and aggregate wages and salaries paid for positions created by each production or project that received tax credits under this section and information relating to the distribution of productions receiving credits, by county and by type of production.
[(k)] (o) Qualified productions
shall comply with subsections (d), (e), (f), and (h).
[(l)] (p) For the purposes of
this section:
"Commercial":
(1) Means an advertising message that is filmed using film, videotape, or digital media, for dissemination via television broadcast or theatrical distribution;
(2) Includes a series of advertising messages if all parts are produced at the same time over the course of six consecutive weeks; and
(3) Does not include an advertising message with Internet‑only distribution.
"Digital media" means production
methods and platforms directly related to the creation of cinematic imagery and
interactive media content, specifically using digital means, including
but not limited to digital cameras, digital sound equipment, and computers, to
be delivered via film, videotape, interactive game platform, internet,
wireless, or other digital distribution media [(excluding Internet-only
distribution)].
"Legal resident" shall have the same meaning as "resident" in section 235-1.
"Post production" means production activities and services conducted after principal photography is completed, including but not limited to editing, film and video transfers, duplication, transcoding, dubbing, subtitling, credits, closed captioning, audio production, special effects (visual and sound), graphics, and animation.
"Production" means a series of activities that are directly related to the creation of visual and cinematic imagery to be delivered via film, videotape, or digital media and to be sold, distributed, or displayed as entertainment or the advertisement of products for mass public consumption, including but not limited to scripting, casting, set design and construction, transportation, videography, photography, sound recording, interactive game design, and post production.
"Production expenditures" means the expenditures incurred by a qualified production within the State that are subject to the general excise tax under chapter 237 or income tax under this chapter and that have not been financed by any investments for which a credit was or will be claimed pursuant to section 235-110.9, for tangible and intangible property used for, and services performed primarily and customarily in, production, including preproduction and post production, but excluding costs for development, marketing, and distribution, including but not limited to:
(1) Wages, salaries, or other compensation paid to legal residents of this State, including amounts paid through payroll service companies, for technical and production crews, directors, producers, and performers;
(2) Net expenditures for sound stages, backlots, production editing, digital effects, sound recordings, sets, and set construction;
(3) Net expenditures for rental equipment, including but not limited to cameras and grip or electrical equipment;
(4) Up to $300,000 of the costs of newly purchased computer software and hardware unique to the project, including servers, data processing, and visualization technologies, which are located in and used exclusively in the State for the production of digital media; and
(5) Expenditures for meals, travel, and accommodations. For purposes of this definition, the term "net expenditures" means the actual amount of money a qualified production spent for equipment or other tangible personal property, after subtracting any consideration received for reselling or transferring the item after the qualified production ends, if applicable.
"Qualified digital media project" means development of animation, graphics, visual effects, post production, and interactive media for entertainment and education that is produced for distribution in commercial or educational markets, including but not limited to a video game or production intended for game platform, physical media, internet or wireless distribution.
"Qualified expenditures" means production expenditures incurred in this State by a qualified production for:
(1) Goods purchased or leased or services, including but not limited to insurance costs and bonding, payroll services, and legal fees, that are provided by a vendor or supplier in the State that is registered with the State, has a physical location in the State, and employs one or more legal residents of this State;
(2) Payments to legal residents of this State in the form of salary, wages, or other compensation up to a maximum of $400,000 per resident; provided that a completed declaration of legal residency in this State shall accompany the documentation submitted to the department for reimbursement; and
(3) Other direct production costs specified by the department in consultation with the department of business, economic development, and tourism.
"Qualified expenditures" do not include expenditures incurred before certification, with the exception of those incurred for a commercial, a music video, or the pickup of additional episodes of a high-impact television series within a single season.
"Qualified independent and emerging media project" means a qualified production of film, video, television, or interactive entertainment that is produced for distribution in commercial or educational markets, including but not limited to feature film, short film, television show, television series, a video game or production intended for game platform, physical media, internet, or wireless distribution.
"Qualified production":
(1) Means a production, with expenditures in the
State, for the total or partial production of a feature-length motion picture,
short film, made-for-television movie, commercial, music video, interactive
game, television series pilot, single season (up to twenty‑two episodes)
of a television series regularly filmed in the State (if the number of episodes
per single season exceeds twenty‑two, additional episodes for the same
season shall constitute a separate qualified production), television special,
single television episode that is not part of a television series regularly
filmed or based in the State, national magazine show, or national talk show.
For the purposes of subsections (d) and (j), each of the aforementioned
qualified production categories shall constitute separate, individual qualified
productions[;]. Notwithstanding the foregoing, for purposes of
satisfying the criteria of subsection (d), a taxpayer shall claim as part of a
qualified production the creation of related content intended for distribution
over the Internet, wireless network, or similar methods of distribution;
and
(2) Does not include: daily news; public affairs programs; non-national magazine or talk shows; televised sporting events or activities; productions that solicit funds; productions produced primarily for industrial, corporate, institutional, or other private purposes; and productions that include any material or performance prohibited by chapter 712.
["Qualified production costs" means
the costs incurred by a qualified production within the State that are subject
to the general excise tax under chapter 237 or income tax under this chapter
and that have not been financed by any investments for which a credit was or
will be claimed pursuant to section 235‑110.9. Qualified production
costs include but are not limited to:
(1) Costs incurred during preproduction
such as location scouting and related services;
(2) Costs of set construction and
operations, purchases or rentals of wardrobe, props, accessories, food, office
supplies, transportation, equipment, and related services;
(3) Wages or salaries of cast, crew, and
musicians;
(4) Costs of photography, sound
synchronization, lighting, and related services;
(5) Costs of editing, visual effects,
music, other post-production, and related services;
(6) Rentals and fees for use of local
facilities and locations;
(7) Rentals of vehicles and lodging for
cast and crew;
(8) Airfare for flights to or from Hawaii, and interisland flights;
(9) Insurance and bonding;
(10) Shipping of equipment and supplies to
or from Hawaii, and interisland shipments; and
(11) Other direct production costs specified
by the department in consultation with the department of business, economic
development, and tourism.]"
PART IV
SECTION 7. The purpose of this part is to:
(1) Establish a motion picture, digital media, and film production infrastructure tax credit for an unspecified percentage of qualified infrastructure costs;
(2) Require the expenditure of at least $10,000,000 in qualified infrastructure costs;
(3) Provide for one hundred per cent recapture of the tax credit.
SECTION 8. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§235‑ Motion picture, digital media, and film production infrastructure income tax credit. (a) Any law to the contrary notwithstanding, there shall be allowed to each taxpayer subject to the taxes imposed by this chapter, an income tax credit which shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed. The amount of the credit shall be per cent of the qualified infrastructure costs incurred by a qualified taxpayer in any county of the State; provided that the tax credit claimed per qualified infrastructure project shall not exceed $ .
In the case of a partnership, S corporation, estate, or trust, the tax credit allowable is for qualified infrastructure costs incurred by the entity for the taxable year. The cost upon which the tax credit is computed shall be determined at the entity level. Distribution and share of credit shall be determined by rule.
(b) The credit allowed under this section shall be claimed against the net income tax liability for the taxable year. For the purposes of this section, "net income tax liability" means net income tax liability reduced by all other credits allowed under this chapter.
(c) If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of credits over liability shall be refunded to the taxpayer; provided that no refunds or payment on account of the tax credits allowed by this section shall be made for amounts less than $1. All claims, including any amended claims, for tax credits under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed. Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.
(d) To qualify for this tax credit, a qualified infrastructure project shall:
(1) Meet the definition of a qualified infrastructure project specified in subsection (l);
(2) Have qualified infrastructure costs totaling at least $10,000,000; and
(3) Provide evidence that for the first two years of the infrastructure project credit, at least sixty per cent, and thereafter, at least seventy per cent, of the positions are filled by legal residents of this State, whose residency is demonstrated by a valid Hawaii driver's license or other state-issued identification confirming residency, or students enrolled in a construction or related course of study at an educational institution in the State.
(e) To receive the tax credit, the taxpayer shall first prequalify the infrastructure project for the credit by registering with the department of business, economic development, and tourism during the development stage. Failure to comply with this provision may constitute a waiver of the right to claim the credit.
(f) If all or a portion of an infrastructure project is a facility that may be used for other purposes unrelated to production or post-production activities, then the project shall be approved only if a determination is made that the multiple-use facility will support and will be necessary to secure production or post-production activity.
The taxpayer may also request a comfort ruling from the department of taxation regarding the applicability of the tax credit to a specific qualified infrastructure project.
(g) The director of taxation shall prepare forms as may be necessary to claim a credit under this section. The director may also require the taxpayer to furnish information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.
(h) Every taxpayer claiming a tax credit under this section for a qualified infrastructure project shall, no later than ninety days following the end of each taxable year in which qualified infrastructure costs were expended, submit a written, sworn statement to the department of business, economic development, and tourism, identifying:
(1) All qualified infrastructure costs, if any, incurred in the previous taxable year;
(2) The amount of tax credits claimed pursuant to this section, if any, in the previous taxable year; and
(3) An estimate of the full-time equivalent positions for legal residents of this State created by each project, by job category and by county.
(i) The department of business, economic development, and tourism shall:
(1) Maintain records of the names of the taxpayers and qualified infrastructure projects thereof claiming the tax credits under subsection (a);
(2) Obtain and total the aggregate amounts of all qualified infrastructure costs per qualified infrastructure project per taxable year; and
(3) Provide a letter to the director of taxation specifying the amount of the tax credit per qualified infrastructure project for each taxable year that a tax credit is claimed and the cumulative amount of the tax credit for all years claimed.
(j) Upon each determination required under this subsection, the department of business, economic development, and tourism shall issue a letter to the taxpayer, regarding the qualified infrastructure project, specifying the qualified infrastructure costs and the tax credit amount qualified for in each taxable year a tax credit is claimed. The taxpayer for each qualified infrastructure project shall file the letter with the taxpayer's tax return for the qualified infrastructure project to the department of taxation. Notwithstanding the authority of the department of business, economic development, and tourism under this section, the director of taxation may audit and adjust the tax credit amount to conform to the information filed by the taxpayer.
(k) No later than December 31 of each year, the department of business, economic development, and tourism shall provide a report for the previous fiscal year to the governor and the legislature that outlines the return on investment and economic benefits of the tax credits to the State. The report shall also include an estimate of the full-time equivalent positions for legal residents of this State and aggregate wages and salaries paid for positions created by each qualified infrastructure project that received tax credits under this section and information relating to the distribution of qualified infrastructure projects receiving credits, by county and by type of project.
(l) For the purposes of this section:
"Qualified infrastructure costs" means the total costs incurred by a qualified infrastructure project within the State, including the cost of purchasing or leasing real property, which are subject to the general excise tax under chapter 237 or income tax under this chapter and that have not been financed by any investments for which a credit was or will be claimed pursuant to section 235-110.9.
"Qualified infrastructure project" means a construction project in the State, for the development, construction, or renovation of a film, video, television, or media production or post-production facility and the immovable property and equipment related thereto, or any other facility that supports and is a necessary component of such infrastructure project.
(m) For a qualified infrastructure project, the credit claimed under this section shall be recaptured through an annual payment from the taxpayer to the State equal to fifteen per cent of the qualified infrastructure project's taxable income until such time as the credit has been repaid; provided that if the ownership of a qualified infrastructure project is transferred, the transferee shall be obligated to the terms of the recapture under this subsection.
(n) If at any time the infrastructure project ceases to be a qualified infrastructure project, the credit claimed under this section shall be recaptured. The amount of the recaptured tax credit determined under this subsection shall be added to the taxpayer's tax liability, up to one hundred per cent of the tax credit, for the taxable year in which the recapture occurs under this subsection. The taxpayer shall consent to a tax lien in the amount of the tax credit claimed under this section on the property as a condition to receiving the tax credit under this section. If ownership of an infrastructure project is transferred, the transferee shall be obligated to the terms of the recapture under this subsection."
PART V
SECTION 9. Act 88, Session Laws of Hawaii 2006, is amended by amending section 4 to read as follows:
"SECTION 4. This Act shall take effect on
July 1, 2006; provided that[:
(1) Section] section 2 of this
Act shall apply to qualified [production costs] expenditures
incurred on or after July 1, 2006, and before January 1, [2016; and
(2) This Act shall be repealed on January
1, 2016, and section 235-17, Hawaii Revised Statutes, shall be reenacted in the
form in which it read on the day before the effective date of this Act.] 2012."
SECTION 10. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 11. This Act shall take effect on July 1, 2050; provided that:
(1) Section 6 of this Act shall apply to qualified expenditures incurred on or after January 1, 2012, and before January 1, 2027;
(2) Section 8 of this Act shall apply to taxable years beginning after June 30, 2012, and before January 1, 2027; and
(3) This Act shall be repealed on January 1, 2027; provided further that section 235-17, Hawaii Revised Statutes, shall be reenacted in the form in which it read on the day before the effective date of Act 88, Session Laws of Hawaii 2006.
Report Title:
Taxation; Motion Picture, Digital Media, and Film Production Credit; Infrastructure Tax Credit
Description:
Establishes the Hawaii film and digital media special fund; repeals part IX, chapter 201, Hawaii Revised Statutes, relating to Hawaii television and film development (part II); amends the motion picture, digital media, and film production income tax credit to unspecified percentages; amends the total tax credit cap to an unspecified amount; requires annual report; increases requirements for hiring of legal residents of this State; applies to qualified expenditures incurred on or after January 1, 2012, and before January 1, 2027 (part III); establishes a motion picture, digital media, and film production infrastructure tax credit of fifty per cent of qualified infrastructure costs; requires qualified expenditure of at least $10,000,000; increases requirements for hiring of legal residents of this State; requires the credit to be recaptured through an annual payment to the State equal to fifteen per cent of the qualified infrastructure project's taxable income until the credit has been repaid; provides for a 100 per cent recapture of the tax credit if the facilities are no longer used for a qualified activity; requires annual report; applies to taxable years beginning after June 30, 2012 (part IV); effective July 1, 2050; repeals on January 1, 2027. (SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
