2020 -- S 2326

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LC003974

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2020

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A N   A C T

RELATING TO TAXATION -- MOTION PICTURE PRODUCTION TAX CREDITS

     

     Introduced By: Senators DiPalma, Miller, Ruggerio, Sosnowski, and Murray

     Date Introduced: February 05, 2020

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Section 44-31.2-5 of the General Laws in Chapter 44-31.2 entitled "Motion

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Picture Production Tax Credits" is hereby amended to read as follows:

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     44-31.2-5. Motion picture production company tax credit.

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     (a) A motion picture production company shall be allowed a credit to be computed as

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provided in this chapter against a tax imposed by chapters 11, 14, 17, and 30 of this title. The

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amount of the credit shall be thirty percent (30%) of the state-certified production costs incurred

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directly attributable to activity within the state, provided that the primary locations are within the

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state of Rhode Island and the total production budget as defined herein is a minimum of one

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hundred thousand dollars ($100,000). The credit shall be earned in the taxable year in which

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production in Rhode Island is completed, as determined by the film office in final certification

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pursuant to § 44-31.2-6(c). The film office director may issue a waiver of the primary location

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requirement for any motion picture production which incurs and pays a minimum of ten million

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dollars ($10,000,000) in state certified production costs, as defined in § 44-31.2-2, within a

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twelve (12) month period.

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     (b) For the purposes of this section: "total production budget" means and includes the

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motion picture production company's pre-production, production, and post-production costs

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incurred for the production activities of the motion picture production company in Rhode Island

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in connection with the production of a state-certified production. The budget shall not include

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costs associated with the promotion or marketing of the film, video, or television product.

 

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     (c) Notwithstanding subsection (a) of this section, the credit shall not exceed seven

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million dollars ($7,000,000) and shall be allowed against the tax for the taxable period in which

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the credit is earned and can be carried forward for not more than three (3) succeeding tax years.

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Pursuant to rules promulgated by the tax administrator, the administrator may issue a waiver of

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the seven million dollars ($7,000,000) tax credit cap for any feature-length film or television

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series up to the remaining funds available pursuant to section (e) of this section.

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     (d) Credits allowed to a motion picture production company, which is a subchapter S

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corporation, partnership, or a limited-liability company that is taxed as a partnership, shall be

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passed through respectively to persons designated as partners, members, or owners on a pro rata

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basis or pursuant to an executed agreement among such persons designated as subchapter S

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corporation shareholders, partners, or members documenting an alternate distribution method

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without regard to their sharing of other tax or economic attributes of such entity.

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     (e) No more than fifteen million dollars ($15,000,000) in total may be issued for any tax

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year beginning after December 31, 2007, for motion picture tax credits pursuant to this chapter

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and/or musical and theatrical production tax credits pursuant to chapter 31.3 of this title. After

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December 31, 2019, no more than twenty million dollars ($20,000,000) in total may be issued for

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any tax year for motion picture tax credits pursuant to this chapter and/or musical and theater

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production tax credits pursuant to chapter 31.3 of this title. Said credits shall be equally available

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to motion picture productions and musical and theatrical productions. No specific amount shall be

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set aside for either type of production.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION -- MOTION PICTURE PRODUCTION TAX CREDITS

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     This act would authorize the film office director to waive the primary locations within the

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state requirement for any motion picture production which incurs and pays a minimum of ten

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million dollars ($10,000,000) in state certified production costs, within a twelve (12) month

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period.

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     This act would take effect upon passage.

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