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North Carolina axes attractive tax incentive

Mickey RourkeA major tax incentive which has been on offer in North Carolina is set to be replaced with a competitive grant scheme.

The tax break system had been one of the US’s most wide-ranging, offering producers a 25% tax refundable credit. Last year alone, the state handed out $61m in incentives or feature films and TV productions.

The replacement scheme will take the form of a $10m competitive grant programme, conceived by the N.C General Assembly and is due to be activated from 1 January 2015. The new set-up will have a $5m cap per production, which is potentially a lot less than what was on offer under the previous scheme.

With lobbying from film backers, who fear this could see an end in real terms to the state’s film and TV industry, only time will tell if the new grant scheme will have a negative effect on the state.

It is feared the implementation of the new system will have a detrimental effect on employment in the area, but the decision has been defended by the state legislators who suggest that it will even out the economic conditions for all businesses in the state, not just those connected with the film and TV production industry.

North Carolina still remains a popular location for filmmakers – it hosted over 800 productions in the last three decades, including high-profile, bug-budget features such as Iron Man 3, which was awarded around $20m under the previous system.

Another high-profile film to have recently utilised the state’s soon-to-be-defunct tax incentive is Ashby, starring Mickey Rourke (pictured) and Emma Roberts, which shot for just over 80 days earlier this summer in the Charlotte region and created around 600 local jobs.