In a new lawsuit, the Goldwater Institute is challenging a 2022 Arizona law that allows for millions of dollars in tax credits to be issued to attract Hollywood filmmakers.
The suit claims that allowing the state to give away $125 million a year in tax credits to those who agree to produce their films and commercials in Arizona is an unconstitutional gift to private companies.
The Goldwater Institute argues that since the tax credit is refundable, a production could profit if the earned credit exceeds what the company would have owed in taxes.
The suit asks a Maricopa County Superior Court judge to strike down the law and block the Arizona Commerce Authority from paying the $1.6 million in credits it already owes.
Proponents of the law claim that if the suit is successful, any state tax credit could be in peril.
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