The Kansas Film and Digital Media Production Development Act is designed to boost the film, video, and digital media production industry in Kansas by providing income tax credits and sales tax exemptions for eligible productions, which include feature films, documentaries, and video games that incur at least $50,000 in qualified expenses. The act establishes criteria for production companies to apply for these incentives, including the submission of an application, proof of financing, and an economic impact statement. The Secretary of Commerce will oversee the program, evaluating applications based on their potential local impact and imposing limits on eligible expenditures. Notably, the bill introduces a 30% income tax credit on qualified expenditures for certified productions from 2025 to 2034, with a cap of $5,000,000 on the total credits awarded annually, down from a previous limit of $10,000,000.

Additionally, the bill amends existing tax exemption laws to streamline the process for obtaining sales tax exemptions for various organizations and projects, particularly focusing on construction and remodeling for nonprofit entities. It requires contractors to obtain exemption certificates for materials purchased for specific projects and mandates the retention of invoices for five years, subject to audit. The bill clarifies that misuse of these exemptions can lead to penalties, including potential misdemeanor charges. Furthermore, it establishes guidelines for tax refunds on exempt purchases made prior to the enactment of these amendments, ensuring that organizations can recover taxes paid under previous laws. Overall, the legislation aims to enhance the film industry in Kansas while ensuring compliance and accountability in the use of tax-exempt materials for nonprofit projects.

Statutes affected:
As Introduced: 79-3606
As Amended by Senate Committee on Commerce: 79-3606
As introduced: 79-3606
As Amended by Senate Committee: 79-3606