WBD considers $8.5 billion investment in Las Vegas studio – subject to state tax credits
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21 August 2024
Warner Bros. Discovery will reportedly invest $8.5 billion over 17 years to produce films and television shows at a newly established production studio in Las Vegas, provided the state of Nevada passes a mandatory film tax credit program.
At least 18 states have introduced tax incentives since 2021 to encourage Hollywood studios, streamers and independent producers to spend money producing films and television shows in their state.
Film tax incentives typically consist of tax credits equal to a percentage of the qualified expenditures of a film or television production in the state and/or exemptions from sales tax on qualified transactions, according to the National Conference of State Legislatures.. The credits are often refundable (recoverable without any tax liability) or transferable if the value of a company’s credits is greater than its tax liability.
Georgia reportedly spends $1 billion annually subsidizing Hollywood productions, which in turn spend more than $4 billion on studios in Atlanta and elsewhere, including the actor and producer’s Tyler Perry Studios.
For WBD, opening a studio in Southern Nevada depends on the legislative passage of a failed 2023 bill that would have provided producers with loans of more than $190 million a year based on a minimum level of privately funded infrastructure in the state.
The bill, which was publicly supported by, among others, actor Mark Wahlberg, who recently moved to Las Vegas, did not receive the required number of votes.
A revised bill this year that cuts the credits to $95 million a year is expected to get all of the state’s politicians on board. According to Simon Robinson, COO at WBD, WBD is pledging $500 million a year to produce content at a planned 34-acre facility (called “Warner Bros. Studios Nevada”) on the Harry Reid Research and Technology Park on the University of Nevada Las Vegas campus.
WBD spends about $20 billion annually producing films and television shows around the world.
“The most important thing for us is the opportunity to effectively become a producer with our own location in and around Las Vegas,” said Robinson The Nevada Independent“We stand behind both the bill and the state. We’re going to be here for a long time. Hopefully they can make this happen.”
