NY Assembly Budget Includes Tax Credit, Covering Up to 35% of In-State Music Production Expenses

New York City's Flatiron Building
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New York City's Flatiron Building in Downtown Manhattan in 2013.

Assemblyman Joe Lentol (D-North Brooklyn) announced Tuesday that the Assembly's one-house budget will include a tax credit to companies that record and produce music in New York state, intended to create jobs for music industry workers. 

The Empire State Music Production Tax Credit is supposed to benefit the wide range of music professionals, from musicians to engineers and sound mixers, with a 25 percent credit downstate and 35 percent credit upstate available to music production companies. The credit covers expenses ranging from studio and equipment rental fees to hotel and transportation expenditures directly related to music production. To qualify, the majority of production and recording costs must be spent in New York. 

'New York Is Music' Coalition Aims to Stimulate Empire State's Ailing Music Industry

A total of $25 million has been allocated in the one-house Assembly budget for the program this year. 

"As we come out of the recession, states have looked back to the arts as economic engines. New York began offering tax credits to support the film and television industry in 2004, which has brought over $7 billion in spending to the state. Unfortunately, the arts have not historically been looked at as an industry that can create significant revenue for a state, but the times are changing," said Lentol in a statement. "By looking at the film industry in New York, we know that the arts are definitely an economic engine."

The program also includes a provision for new artists who have never previously released a record, adding an additional 10 percent credit for their album or EP. 

Lentol touts the Empire State Music Production Tax Credit as one of the most transparent tax credit programs in history. The Empire State Development Corporation will administer the program and create a public annual report to outline the companies receiving the credit and their corresponding projects, quantifying data to determine the program's viability and overall success of job creation and retention. 

"We must bring the music industry in New York back to its heyday by bringing music production back, by promoting emerging artists and ultimately, by creating and retaining jobs," said Lentol. "Not only will this program directly create jobs in the music production industry, it will also have indirect effects on a multitude of other music related industries.

"While talking about creating jobs is great, we are also going to quantify and report this data every year to show the real results."

This iteration is slightly different from what was put forth in October, which gives music recorders and producers 20 percent tax credit amounting to $60 million in tax breaks. Justin Kalifowitz, CEO of Downtown Music Publishing and co-founder of the New York Is Music coalition (an organization with more than 200 participating businesses and organizations) along with William Harvey, explains the process to Billboard in an email.

"This updated program included in this year's one-house budget was developed out of several months of extensive research, roundtables and discussions that Assembly Member Lentol convened with New York Is Music co-founders and their coalition partners from across the State," he writes.


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