The HITS Act, which would allow musicians, technicians and producers to deduct 100% of recording costs up to $ 150,000 on their taxes in the year they are incurred, remains unchanged from its previous versions. It was first introduced in the House on July 31, 2020 (followed by a related bill in the Senate on December 3, 2020), although it was not passed as part of the last two plans. pandemic relief despite intense lobbying from independent music advocates to have it included. It was reintroduced by its original sponsors in the House and Senate in March.
Under the current tax code, music creators are required to amortize production expenses for tax purposes over the economic life of a sound recording, a period that typically ranges from three to four years. If passed, the HITS law would apply the same tax standard to music as it does to film and television productions, which already benefit from a 100% deduction in the first year, helping music professionals recover from the severe downturn. economic impact caused by the COVID-19 pandemic. According to a Copyright Alliance survey last year, 88% of creators lost income during the downturn, more than double the national average for other industries. About half of the respondents lost 90% or more of their income.
In a statement released when the bill was reintroduced in March, the Recording Academy chief executive officer Harvey Mason Jr. said the HITS Act would succeed in “putting music creators on an equal footing with other creative industries – helping thousands of independent creators get back on track by encouraging music production, creating new opportunities and revitalizing the music economy ”.
The Build Back Better Act, the cornerstone of President Bidenthe EU’s economic agenda, is currently the subject of vigorous debate in both houses of Congress, although the bill is under threat due to clashes between moderate and progressive Democrats, who must support in l ‘unanimity on the package because of the very slim partisan margins in Congress. At least two Democratic senators – Kyrsten Sinema (D-AZ) and Joe manchin (D-WV) – objected to the size of the package, with Manchin specifically suggesting it be reduced to $ 1,000 billion to $ 1.5 trillion in revenue.
In the House, the 96-member Progressive Caucus threatened to forgo a vote on the smallest bipartisan $ 1,000 billion infrastructure bill – the second leg of Biden’s “build back better” agenda that has already passed in the Senate and currently faces a Sept. 27 House pass deadline – if the Build Back Better Act is not passed. President Biden held a series of meetings with lawmakers on Wednesday to attempt a resolution.