SOUTH CAROLINA
Selected Southern States Incentives Compared in an Informative Chart

SOUTH CAROLINA INCENTIVES PAGE FROM THEIR FILM COMMISSION - CLICK HERE

8/23/08:  SOUTH CAROLINA, which once offered one of the best incentive programs in the country, is considering revising its incentive.  Currently, the state offers a rebate (not a refundable credit, but an actual rebate) of 30% for in-state materials and services, 20% for resident crew plus all cast up to $1 million, and 10% for out-of-state crew (with a maximum rebate of $3500 per out-of-state crew person). A number of sound stage development projects and training programs have been announced. Funds are still available for the current fiscal year.
 

South Carolina Film Office
Jeff Monks, Commissioner
Columbia, South Carolina  USA
Jmonks@SCcommerce.com

 South Carolina Film Office
 1201 Main Street Suite 1600
 Columbia, SC 29201
 Telephone: 803.737.0490  /  (803) 737-0492
 Fax: 803.737.3104
 Email: scfilmoffice@sccommerce.com
 Mailing Address: 1201 Main St. Suite 1600, Columbia, SC 29201
 Production Hotline: 800.269.7281 (in state)
 or 803.737.3022 (out of state)

South Carolina offers one of the most generous rebates in the US comprised of a 20%
wage rebate and a 30% goods and services rebate. If the total production cost expended in South Carolina exceeds $1 million, the state offers an assignable tax rebate of 20% of the qualified labor costs for all cast or crew members subject to South Carolina withholding tax, whether or not they live in the state, excluding salaries that exceed $1 million. Wages paid to loan-out corporations and personal service corporations also qualify for the rebate if SC withholding tax is paid.
The rebate may not exceed the amount withheld on South Carolina withholdings.
Additionally, up to 30% of all South Carolina goods and services purchased for an instate production may be rebated to the production company.

Because some materials are not available locally, until July 2007 a production
company may set up a separate “pass-through” company which can order:
• Film stock
• High-end camera rentals
• Trailers, honey wagons, and other special transportation
• Specialized cranes
• Catering companies with kitchens on wheels
• Grip, electrical and rigging equipment (only if unavailable in S.C. or not
available at competitive prices)

The pass-through company will be liable for South Carolina taxes.
A non-transferable investment tax credit of 20% for residents is available up to a
maximum of $100,000. Interested producers should contact the film commission, as
they may be able to make an introduction to a local partner.

The production company must complete an Incentive application in advance of the production. Within 10 days the Film Commission will notify the producer if the production qualifies, and for which incentives. The final audit is conducted by the state at no cost to the production, and the rebate check is cut within 30 days of the completion of the audit. Note that the application may not be modified once approved, and that the rebate will not apply to amounts exceeding what has been preapproved.
Provided that a film, television, or commercial production spends at least $250,000 within the state in a consecutive twelve-month period, South Carolina offers a waiver of the 5% sales and use tax and an exemption from the 7% lodging tax.

Charleston can supply crew and some department heads, with smaller crew bases available in Columbia and Greenville. A searchable database is on the website.

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Productions are eligible for:
    * 15% Wage Rebate
    * 15% Supplier Rebate (up to 22% savings
      when combined with the exemption below)
    * Sales Tax Exemption
    * Fee-free State Properties

South Carolina Pays Cash

    * SC's incentive is a cash rebate, not a tax credit involving brokers' fee and a waiting period.
    * Your rebate check is cut within 30 days of our final audit - use the money in post!
    * SC is the only state that will reserve your estimated rebate funds, assuring production that rebate funds are available.
    * Payments made to numerous OUT-OF-STATE suppliers and vendors, not just in-state suppliers, qualify for the supplier rebate.
    * Wages of ALL crew and cast qualify for the wage rebate, regardless of where they reside.
    * There is no per-project cap; no sunset legislation.
    * Production auditing is completed by South Carolina - saving the production $15 - $50k. No independent audit necessary.
    * Pay NO sales tax on hotel rooms (save 7%) and other purchases (5%). Simply show the exemption certificate.
    * Rebate funds come from the pro-business Department of Commerce, the parent agency of the Film Commission.
    * Before filming, contact the South Carolina Film Commission to request your incentive application. Once qualified, you'll begin saving immediately!

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These incentives passed the South Carolina legislature and took effect July 1, 2004.

The South Carolina Motion Picture Incentive Act of 2004
H.4968
Effective as of July 1, 2004
 

Incentive Overview

Employee Tax Rebate

Feature length motion pictures, videos, television series or commercials made in whole or in part in SC and intended for national theatrical or television viewing or as a television pilot qualify for a tax rebate for the employment of persons subject to SC withholdings.
The rebate is equal to five percent (5%) of the total aggregate SC payroll for persons subject to SC income tax withholdings employed in connection with the production when total production costs in SC equal or exceed one million dollars ($1,000,000) during the taxable year.
The rebate is not applicable to an employee whose salary is equal to or greater than one million dollars ($1,000,000) for the project.

Supplier Enhancement Rebate

Seven percent (7%) of all South Carolina goods and services purchased by the motion picture, television series or commercial in the State may be rebated to the production company if it has minimum in-state expenditures of one million dollars ($1,000,000).

Relief From Payment Of State Sales And Use Tax

A production company that intends to expend in the aggregate two hundred fifty thousand dollars ($250,000) or more in connection with the filming or production of one or more motion pictures in the State of South Carolina within a consecutive twelve-month period, upon making application for, meeting the requirements of, and receiving written certification of that designation from the SC Department of Revenue, shall be relieved from the payment of state sales and use taxes on funds expended in South Carolina in connection with the filming or production of a motion picture or pictures.

Accommodations Taxes Rebate

A rebate of the Accommodations (Bed) Tax will be provided to production companies for stays of thirty (30) aggregate days over a twelve (12) month period in South Carolina.

Commercial Production Company Tax Incentive

Commercial production companies with a total base investment of over $500,000 in the aggregate during a calendar year are eligible for a ten percent (10%) tax credit.

Taxation Credits For The Creation Of SC Motion Pictures Or Facilities

The investors in SC-created motion pictures and/or production/post-production facilities are entitled to SC tax credits based upon their investment amount.

1. Motion Picture Project Tax credit
A taxpayer may claim an income tax credit of up to twenty percent (20%) of the taxpayer’s cash investment in the development or production of a single SC motion picture.
Credits are limited to $100,000.
Unused credit may be carried forward fifteen (15) succeeding taxable years.
All credits cannot reduce a taxpayer’s income tax liability by more than fifty percent (50%) for any given year.

2. Production/Post-Production Facility
A taxpayer may claim an income tax credit of up to twenty percent (20%) for the construction or conversion, or equipping, or any combination of these activities of a motion picture production or post-production facility.
Credits are limited to $100,000.
Unused credit may be carried forward fifteen (15) succeeding taxable years.
All credits cannot reduce a taxpayer’s income tax liability by more than fifty percent (50%) for any given year.

Motion Picture/Digital Media Education and Skills Development

The SC Film Commission has established a grant fund for the promotion of collaborative production efforts between S.C. institutions of higher learning and SC industry professionals.

Note:  For all incentives the definition of “motion picture” project is: 'Motion picture' means a feature-length film, video, television series, or commercial made in whole or in part in South Carolina, and intended for national theatrical or television viewing or as a television pilot produced by a motion picture production company. The term 'motion picture' does not include the production of television coverage of news and athletic events or a production produced by a motion picture production company if records, as required by 18 U.S.C. 2257, are to be maintained by that motion picture production company with respect to any performer portrayed in that single media or multimedia program.

For more information, please contact the DGA Runaway Production Committee, Liz Ryan, Chair (310) 822-6042, Ryanworks1@earthlink.net
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From the Law:
.................a motion picture production company that intends to expend in the aggregate two hundred fifty thousand dollars or more in connection with the filming or production of one or more motion pictures in the State of South Carolina within a consecutive twelve-month period, upon making application for, meeting the requirements of, and receiving written certification of that designation from the department as provided in this chapter, shall be relieved from the payment of state sales and use taxes on funds expended in South Carolina in connection with the filming or production of a motion picture or pictures.....................

.................A motion picture production company that intends to film all, or parts of, a motion picture in South Carolina and desires to be relieved from the payment of the state sales and use tax as provided in this chapter shall provide an estimate of total expenditures expected to be made in South Carolina in connection with the filming or production of the motion picture. The estimate of expenditures must be filed with the department before the commencement of filming in South Carolina...........................

.............Once the application is approved by the Director of the South Carolina Film Commission, the Department of Revenue shall issue a written certification of state sales and use tax exemption to the motion picture production company as evidence of the exemption....................

..........................A motion picture production company is entitled to a tax rebate for the employment of persons subject to South Carolina income tax withholdings in connection with production of a motion picture. The rebate is equal to five percent of the total aggregate South Carolina payroll for persons subject to South Carolina income tax withholdings......................The rebate must be distributed to the motion picture production company at the completion of physical production and support activities................

...............................The State or its political subdivisions may not charge a location fee for properties they own if the properties are used for seven or fewer days as a location in the production of a motion picture.............................

..............................(the state)authorizes a tax credit against state income tax for production companies that produce a commercial production....................The tax credit may be earned by production company at the time of its investment in a state-certified production and must be calculated as a percentage of the investment according to the total base investment dollars certified. If total base investment is greater than five hundred thousand dollars in the aggregate during the calendar year, the production company is allowed a tax credit of ten percent of the actual South Carolina investment made by that production company. The State has annually one million dollars in total tax credits to disburse to all eligible production companies (first come, first served)..................READ MORE
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ARTICLE - Charleston Post & Courier  - 04/14/04 - South Carolina lawmakers, who watched the bottom drop out of the state's film business last year, are scrambling to catch up with the likes of North Carolina, Georgia, Louisiana and New Mexico........The new legislation, Senate bill 1057 and House bill 4968, would cancel sales and use taxes entirely on all productions spending more than $250,000. If the budget for the project exceeds $1 million, the state would pay filmmakers a 7 percent rebate on the cost of goods and services and a 5 percent rebate on employment tax. It would also set up a film foundation to solicit donations to help recruit movie, TV and commercial crews...............................................READ MORE
 
 
 

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News article - The University of South Carolina  Daily Gamecock Newspaper - April 28, 2004

The movie business has been producing films in Louisiana instead of South Carolina because it's cheaper, but the S.C. Legislature is hammering out a tax incentive plan with hopes that it will turn some of the spotlight toward South Carolina.

"Louisiana has taken a very aggressive (tax incentive) stance, and South Carolina was losing a large portion of its market share," said State Rep. Harry Limehouse, R-Charleston Co., who introduced the bill to the House of Representatives in March.

"The goal of the bill is to regain our market share of films being made in the country and become a leading state through tax incentives," the congressman said.

The bill, the Motion Picture Incentive Act, would give production companies that choose the state as a shooting site a 7-percent rebate on production costs and a 5-percent employment tax rebate if the company spends $1 million or more in one year, as well as assistance in finding production locations.

 "You have to give some type of incentive to entice industry or production companies to come into the state," said state Rep. J. Anne Parks, D-Greenwood, who also sponsors the bill.

The act would create a film foundation to solicit donations; give the South Carolina Film Commission 13 percent of the collected Admissions Tax; and promote collaboration between state educational institutions and motion picture entities.

 "We think this bill will place us in a good position," Limehouse said.

The intent of the incentive is to stimulate the state's lumbering economy with jobs and incoming monies.

"When used wisely, tax incentives can be an important tool for states to encourage business," said Donald Schunk, an assistant economics professor at USC who specializes in Southern economies.

Schunk referenced the tax incentive pull and landing of the BMW plant in the Upstate as an example of lost tax money being strongly outweighed by other economic increases.

 "These kinds of incentives certainly have the potential to work," Schunk said. "There are a lot of examples where it does work."

"In the case of motion pictures," he said, "that's probably going to bring in some money."

The proposed tax incentive is coming at a time when movie production companies are more often choosing to film at the cheapest locations.

"Location shooting is partly to get a good look, but the bottom line is where you can get a film made with the most quality and effectiveness for the least amount of money," said Ina Hark, director of the Film Studies department.

"It's a business," she added.

The act has made its way through the House and is in the Senate Finance Committee where it is awaiting further attention.

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Production Update Magazine  May 2005:

THE CAROLINAS
What You Need To Know About Lensing In The North and South
by Lily Gordon
For those of you who have ever visited North and South Carolina, or even just passed through, you know how truly beautiful that part of the country is. With the scent of magnolia and wisteria wafting through warm southern breezes; the serenading cicadas lulling you into a peaceful slumber; the brand new (and soon to be brand new) film incentives...who wouldn’t want to find a reason to film in the Carolinas?  It is picture perfect; perfect for pictures, really. From the sandy beaches and salty sea air of Hilton Head to the genteel hospitality and splendid homes of Charlestown, North and South Carolina are just bursting with breathtaking locations, both historical and modern. P3 recently spoke with film commissioners, producers and studio executives to give you the low-down on what it takes to produce your next film in the Carolinas.........................READ MORE