Tax Incentives for Producing a Motion Picture in Arizona

Overview

Who

A company that:

1. Is primarily (more than 50%) engaged in the business of producing motion pictures,
2. Has the lawful rights to produce the motion picture,
3. Has a physical office and bank account in Arizona,
4. Begins production within 90 days of the pre-approval date,
5. Spends Arizona production costs of at least $250,000, and
6. Employs Arizona residents in its motion picture productions. Beginning in 2008 thru 2010, at least 50% of the full-time employees working in this state must be Arizona residents.

What

Transaction Privilege Tax (TPT) Exemption on:

• Purchased machinery, equipment and other tangible personal property,
• Job printing, embossing, engraving and copying,
• Leased or rented lodging space,
• Sales of catered food, drink and condiments, and
• Construction contracts for buildings and other structures.

Use Tax Exemption - on machinery, equipment and other tangible personal property.

Income Tax Credit - a transferable Arizona income tax credit. Click here to view the available amount of tax credits.

How

To become a qualified company and receive motion picture production tax incentives please view the application process.

Why

A qualified company may realize the following tax savings:

• TPT exemptions of approximately 6% off of purchases.
• Use tax exemptions of approximately 5% off of out-of-state purchases.
• Income tax credits equal to 20% or 30% of the company’s investment in eligible Arizona production costs.

When

Commerce accepts applications year round for the Motion Picture program. For 2009 tax incentives, Commerce will begin accepting application on Friday, January 2, 2009 between the hours of 8:00 am and 5:00 pm.