### Louisiana House Moves to Abolish $150 Million Film Tax Incentive

In a decisive 87-12 vote, the Louisiana House of Representatives approved a bill on Tuesday to eliminate the state's $150 million tax rebate program for film and TV production. The measure is part of a broader initiative to overhaul the state's tax system and reduce income tax rates.

Louisiana pioneered the concept of film tax incentives back in 1992, but it wasn't until the program was amended a decade later that it began attracting significant film production activities. The current program offers a 25% rebate on production costs, which can increase to 40% under certain conditions.

If the bill also gains approval from the Senate and governor, the film incentive would officially expire on June 30. The special legislative session was convened by Gov. Jeff Landry, a Republican who assumed office in January, with the goal of reducing personal and corporate income taxes and eliminating various credits and exemptions, including the film incentive.

"Our proposal begins the process of eliminating special treatment for the chosen few, while restoring equity for those who currently carry the heavy tax burden," Gov. Landry remarked during the session's opening.

Supporters of the film incentive, including industry representatives, argue that the program has stimulated thousands of high-paying jobs and resulted in $350 million in investments in studio infrastructure. Jason Waggenspack, President of Film Louisiana, emphasized the unique culture and skill set in the state, stating, "We want to see that grow and prosper."

Yet, opposition to eliminating the incentive is significant. Rep. Mandie Landry, a Democrat from New Orleans and unrelated to the governor, cautioned that axing the credit could force film workers to either leave the state or revert to service industry jobs.

Conversely, Republican Rep. Chance Keith Henry criticized the current tax system as unfair, claiming it favors those who can afford to lobby for credits or exemptions. "We're stepping back from that," he said.

In the wider context, other states have been expanding their film production incentives. For instance, California is looking to boost its incentive from $330 million to $750 million, while New York recently upped its program to $700 million. Georgia continues to lead with an uncapped tax credit that surpasses $1 billion annually.

The bill's passage in Louisiana also includes the elimination of three personal income tax brackets, to be replaced by a flat 3% income tax. Additionally, it would terminate tax credits for digital media production, historic building rehabilitation, and angel investments, among others. Another bill aims to simplify and reduce the corporate income tax.

Louisiana's economic development department is considering more narrowly focused incentives for the future, targeting businesses that pay substantially above the local median wage. However, the department's secretary, Susan Bourgeois, argued that these incentives should not be industry-specific.

Despite the pending elimination of the film tax incentive, Jason Waggenspack remains hopeful. In a statement on Tuesday, he indicated willingness to explore new benefits within the special tax session to further bolster the state's film industry.

The push to reform Louisiana's tax system aims to stimulate economic growth and enhance competitiveness with other Southern states like Texas, Tennessee, and Florida, which do not impose income tax. The state's film tax incentive, which once earned Louisiana the title of "Hollywood South," has seen dramatic growth and eventual caps over the years, making its potential elimination a significant pivot in policy.