Georgia has continued to foster a pro-business environment, maintaining its 34th ranking for “business friendly” state according to the Tax Foundation’s 2012 State Business Tax Climate Index. The Peach State ranks ninth for corporate tax, making our state an industry hub. This ranking is a direct result of our pro-family and pro-business tax structure. The recent changes to it will only boost our state’s ranking and attract new jobs while decreasing the tax burden on industries already in our state.
A key component of the comprehensive, pro-business tax reform is the MEGA jobs tax credits. Part of these tax credits is the continuation of our state’s current film tax credit that would have expired on July 1, 2012. Georgia’s progressive tax structure has placed Georgia third behind California and New York for film and television production. The film tax credit has become an essential part of this state’s economic viability. In the last year alone, the entertainment industry generated more than $2.4 billion in state revenues as well as over 25,000 jobs for Georgians. Currently, TV, film, and interactive gaming production companies qualify for up to 30 percent in transferable tax credits. This attractive incentive has spurred growth from Savannah to the Blue Ridge Mountains, helping us rebuild after the greatest economic downturn since the Great Depression.
The increased activity in film production has also given Georgia an opportunity to be viewed, in so many different lights, by millions of people around the world. Our communities, historical sights, and schools have served as the back drop for hundreds of movies and television shows, highlighting the many attractions our state has to offer tourists.
Another element of the MEGA jobs tax credits is the Mega project tax credit. This tax credit rewards large companies that create 1,800 net new positions. These corporations should also have a minimum annual payroll of $150 million or make a minimum $450 million investment in Georgia. Organizations that meet both these requirements will now have an extended amount of time to create the 1,800 new jobs.
Companies that qualify for this credit tax credit can claim $5,250 per job per year for the first five years of each net new job. In total, this is an annual $9.45 million tax write-off to incentivize companies to hire and put unemployed Georgians back to work. The maximum number of jobs for the MEGA project tax credit is raised from 3,300 to 4,500. If companies create 4,500 net new jobs, their annual tax credit will be more than $23 million.
Another pro-business policy is expanding the current Freeport Exemption that allows counties and municipalities to exempt certain types of inventory goods. This exemption will now include business inventory or real property not covered in the current law. The Level Two Freeport Exemption will be flexible allowing counties to implement at 20, 40, 60, 80 or 100 percent level from the local property tax. This tax exemption will benefit local governments to lure and retain businesses in their communities.
These components of Georgia’s 2012 Tax Reform are just a few out of the overall package that was passed this legislative session. I will continue to update you on the measures that my colleagues and I took to ensure that our great state remains the economic hub of the Southeast. While we are still in the midst of a prolonged recovery, there are numerous signs Georgia’s economy is showing a renewed since of life. It continues to be an honor to serve you, my constituents, of the 51st district. If there is anything I can do for you, please don’t hesitate to contact me.