New Hawaii law raises tax credits for filmmakers

HONOLULU (AP) -- Hawaii Gov. Neil Abercrombie has signed a law increasing tax credits for filmmakers to help expand the state's movie industry.

The law, which will goes into effect next month, extends film tax credits until 2019 and boosts them from 20 to 25 percent in counties with fewer than 700,000 people.

The law also raises tax credits from 15 to 20 percent in counties like Honolulu with larger populations.

Movie productions will be able to claim a credit of up to $15 million after the law goes into effect July 1.

Advocates of the measure have said it will help diversify Hawaii's economy, which relies greatly on tourism and the military.

Gladys Baisa, from the Maui County Council, told state legislators who deliberated the proposal that the bigger tax credits will help compensate for the high cost of producing movies in Hawaii. She said the measure will add needed jobs for local people.

But the Tax Foundation of Hawaii, an educational nonprofit organization, has been highly critical of the tax credits.

"Taxpayers should be insulted that lawmakers can provide breaks for film productions but refuse to provide tax relief for residents, many of whom work two or three jobs just to keep a roof over their head and food on the table," the organization wrote in testimony submitted to the Legislature.

The group called the credits "a drain on the state treasury" and said the money would be better spent on school infrastructure repairs, social programs or tax relief.

Hawaii has been the site of popular TV shows and films including "Lost" and "The Descendants."