ANNOUNCEMENT 01 Jul 2013In July 2013, a US state government announced a targeted tax change.
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Effective July 1, 2013, the state of Hawaii extended and expanded its existing production tax credit (now known as Act 88/89 for the production of films and digital media. It is a refundable tax credit based on a production company's Hawaii expenditures while producing a qualified film, television, commercial, or digital media project. The credit equals 20% of qualified production costs incurred on Oahu, and 25% on the neighbor islands (Big Island, Kauai, Lanai, Maui, Molokai).
In order to access the credit a production must, among other things, make reasonable efforts to hire local talent and crew and provide evidence of financial or in-kind contributions or educational or workforce development efforts toward the furtherance of the local film, television and digital media industries. Under the expanded program, the credit cap is increased from $8 million to $15 million per production, qualifies productions with Internet-only distribution, allows State and County location and facilities fees as a qualified expenditure, and extends the credit's sunset date to December 31, 2018.
Governor David Ige signed into law Act 143 which took effect January 1, 2019. Act 143 extends the sunset date for the tax credit program to January 1, 2026 and institutes a $35 million overall spending ceiling per year. On July 12, 2019, the ceiling for this credit was raised to $50 million.