New Jersey Announces Expanded Tax Breaks for Films and TV
In an exciting piece of good news, we have seen Gov. Phil Murphy of New Jersey announce a rather major increase to the state’s tax break program in an effort to attract further high-profile Films and TV projects. Brandon Blake, entertainment attorney at Blake & Wang P.A, has details on the plan for us.
Seeking the Top Spot in films and tv
New Jersey has been pushing for more and better high-profile film and TV projects for a while now, and it’s good to see them put their money where their mouth is- quite literally. The tax incentives program has not only been extended to 2034 but additional incentives have been put on the cards, too. Digital media projects can now claim credits up to 35%of their expenses back in certain southern counties, and 30% in the rest of the state. The annual limit also rises from $10M to $30M.
This builds on the New Jersey Film and Media Tax Credit Program, created in 2018 and later expanded in 2021, and forms part of a $14.5B incentive package hoping to bolster the state’s post-pandemic recovery. We’ve already seen recent productions, including West Side Story and The Equalizer, take advantage of the program. To date, it’s speculated that the streaming industry provides direct support for more than 20,000 jobs and $2B in wages in the state, let alone indirect effects on the local economy.
The expanded program will also allow for bonuses for building New Jersey-based studios that remain in the area for a decade or more, as well as diversifying film crews. An additional $100M in tax credits are on offer for New Jersey film-lease partners, from credits authorized in other incentive programs, as from 2025.
This should further encourage film productions to film in the area, a figure that’s been steadily rising since the program’s 2018 introduction, with over 49 projects and $635M spent into the local economy since. Extremely effective? It would seem so. New Jersey Motion Picture and TV Commission Executive Director, Steven Gorelick, is also on record as stating that 2022 inquiries are already accelerating.
Not that the program is without its detractors. The New Jersey Office of Legislative Services, for one, claims that the state revenue could see reductions of $20M annually from the program. Yet with increasing competition from Georgia, New Mexico, and other states, it seems New Jersey is keen to keep interested high in the state as a filming location and encourage the local investment into its people, instead.
After all, reducing programs hasn’t worked well for California, which has seen a 39% drop in the number of shows shot there between 2020 and 2021, one of the steepest declines we’ve ever seen. And this is despite the addition of a further $330M in incentives last July.
Where to from here? It will be interesting to see how the new additions to an already enticing tax incentive program develop for New Jersey in the long term. As always, we will be here to keep you up-to-date and informed.