SB 306 / Chamber Supports
A bill that the Senate passed 49-0 is flying under everyone’s radar. With no new budget allocation, it makes a meaningful change to an existing statute that will produce (at minimum) a 6:1 return on the state’s investment.
In 2022, the Indiana General Assembly established the film and media production tax credit, which offers producing entities up to 30% of their qualified expenditures back in the form of a tax credit against their Indiana-based taxes.
However, a problem exists in that many producers/production companies – especially those formed for a single project (i.e., special-purpose entities) – do not have significant tax liabilities to use the credits themselves. This means that producers earn a credit, but cannot use it.
Senate Bill 306, authored by Sen. Andy Zay (R-Huntington) and sponsored by Rep. Dave Heine (R-Fort Wayne), allows producer-credit recipients to sell any part of their credit to another Indiana taxpayer. So, if the producer earns a credit for $30,000, it can sell it to another entity for, say, $25,000. It’s a win-win-win: the production company receives cash for a credit it cannot use, a taxpayer pays less for a credit than the taxes it will offset and the state becomes more attractive to producers and taxpayers.
At least 24 states have a film and media tax credit that’s more attractive than ours because they allow producers to sell their credit to another entity or back to the state. On average, these states see a 6:1 return (tax credits to economic impact).
One example is Kentucky. In 2022, its credit attracted 58 projects that had a $158 million economic impact; 2023: 61 projects, $182 million impact; and 2024: 77 projects, $203 million impact.
Because Indiana’s credit is nontransferable, we’re simply not competitive.
Although not public yet, there are film and media projects waiting on the sidelines watching SB 306’s destiny. Its passage will not only greenlight projects that are teed up, but also serve as a beacon to producers that Indiana wants their business.
The bill, which passed unanimously, now sits in the House Ways and Means Committee’s queue for a hearing.
Call to action: Please ask members of the committee to hear SB 306 and/or request that the Senate amend its language into the state budget bill (House Bill 1001).
