STATE LAWMAKERS REACH AGREEMENT ON FILM TAX CREDIT BILL TO SUPPORT LOCAL ECONOMY

HONOLULU - State lawmakers today reached agreement in conference committee on Senate Bill 2580, SD2, HD1, CD1, relating to the Motion Picture, Digital Media, and Film Production Income Tax Credit, a measure championed by Senate Economic Development and Tourism Committee Chair Lynn DeCoite.

The measure strengthens and modernizes Hawaiʻi’s film tax credit program to support local jobs, attract major productions, and ensure the state remains competitive in a rapidly evolving global entertainment industry.

“Film and television production today is not just a creative industry—it’s a globally competitive, mobile economic sector,” said Senator DeCoite (Senate District 7 – Hāna, East and Upcountry Maui, Moloka‘i, Lāna‘i, Kaho‘olawe and Molokini). “With over 90 countries and many states offering aggressive incentives, we are in an incentives and infrastructure arms race, and Hawaiʻi cannot afford to fall behind. This measure is a necessary recalibration to that reality.”

The conference agreement includes a 5-percent incentive boost for productions that hire at least 80-percent local workers, increasing the credit to 27-percent on Oʻahu and 32-percent in neighbor island counties. The change is intended to drive local hiring, increase paychecks for Hawaiʻi residents, and strengthen the state’s workforce.

The bill also introduces new accountability measures by requiring taxpayers claiming the credit to submit an independent third-party certification verifying qualified production costs, local hires, and other reporting requirements to the Hawaiʻi State Department of Business, Economic Development and Tourism.

Additionally, the measure:

• Raises the per-production cap from $17 million to $20 million and increases the overall annual cap to $60 million, encouraging large-scale productions while maintaining fiscal responsibility;

• Provides a GET exemption for payroll through loan-out companies, making it easier to employ local crews;

• Expands eligibility to include certain streaming platform productions, reflecting modern industry trends; and

• Extends the sunset date of the tax credit program to January 1, 2038, providing long-term certainty for the industry.

  
  

“This is a jobs bill for our local people,” Senator DeCoite added. “Incentives are the entry point—once productions choose Hawaiʻi, our infrastructure, workforce, and small businesses can grow alongside them.”

During conference committee, Senator DeCoite expressed her appreciation to Governor Josh Green, House and Senate leadership, the conference committee members, the respective money committee chairs, House Majority Leader Rep. Sean Quinlan, and Director James Tokioka and the team at the Department of Business, Economic Development and Tourism for their collaboration and hard work in advancing the measure.

Senate Bill 2580, SD2, HD1, CD1, now advances to final readings in both chambers before being sent to the Governor for his signature.