Georgia Senate Limits Game Industry Tax Credits

Georgia Senate Limits Game Industry Tax Credits

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The Georgia Senate has voted to impose limits on tax credits for videogame companies in the state.

New legislation approved by the Georgia Senate would cap the state's 30 percent tax credit for the videogame industry at $25 million in total, while restricting the credit allowed to individual companies to a maximum of $5 million. The idea behind the individual limit, which Senate Majority Leader Chip Rogers said game makers actually support, is to ensure that the money is spread around to several smaller outfits rather than swallowed up by a single, huge company.

The new cap might seem like a blow to the industry but it's actually a huge improvement over the original bill, which sought to eliminate the tax credits entirely. The cap was actually added as an amendment to the bill, which then passed the Senate unanimously. Because of the changes, the bill will now return to the House for approval.

It's an interesting situation because the move to limit tax credits in Georgia is in direct opposition to trends elsewhere in the world. After years of refusing to budge on the matter, the U.K. government finally agreed to extend tax breaks to the industry earlier this month, while Canada, despite its relatively tiny population, has built the world's third-largest videogame industry through long-standing policies of generous tax breaks for developers and publishers. The optics aren't always great and the New York Times reported last year that industry subsidization actually hurts the economy in the long run, but it's still a bit odd to see a state government taking a run at an industry that conventional wisdom says is vital, lucrative and worthy of enthusiastic support.

Source: Atlanta Business Chronicle

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As someone who lives in Georgia, I am proud my state cares about this and found a mutual benefit

Hey! My state's featured in video game news for once! Its an interesting situation to be sure and despite what people might think the state of Georgia is actually trying its best to stimulate the game industry here. Most government officials in the state would agree that we desperately need to expand the entertainment industry's presence here. Turner has a big presence but we are small time compared to California and New York.

Andy Chalk:
The new cap might seem like a blow to the industry but it's actually a huge improvement over the original bill, which sought to eliminate the tax credits entirely.

A sort of 3/5ths compromise? How progressive
BTW Andy

The idea behind the individual limit, which Senate Majority Leader Chip Rogers said game makers actually support, is to ensure that the money is spread around to several smaller outfits rather than swallowed up by a single, huge company.

fix'd

I apologize if this is a stupid question but what does this mean exactly? Is this also a good thing or a bad thing?

Considering the state of our economy, and because of this,

Andy Chalk:
the New York Times reported last year that industry subsidization actually hurts the economy in the long run

I can totally get behind this. Especially because it only limits instead of removing Tax credits, because as far as I know no other industry is having their tax credits getting a talking to.

tbh, it is good that the money be spread more evenly, rather than just favoring one particular industry, that while garnering more money for the state, would divert funds from perhaps other important real life issues

/beingreasonable

Jove:
I apologize if this is a stupid question but what does this mean exactly? Is this also a good thing or a bad thing?

I feel pretty dumbtarded too. But then again, it could be because I don't know what 'tax credits' are

/shame

 

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