California Film and TV Tax Incentive May Get Expanded Amid New Production Push

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California’s film and TV tax incentive program is potentially looking at a major overhaul.

Two proposed bills were unveiled on a Wednesday, though specifics remain undecided, aiming to broaden the range of eligible works for California’s film and TV tax credit incentive scheme.

Bills SB 630 and AB 1138 aim to update key program aspects to ensure that California’s programs remain competitive, helping the state maintain and attract high-quality jobs, particularly those associated with unions. Additionally, these bills are designed to provide a boost and foster growth in industries catering mainly to small businesses, as stated by Assemblymember Rick Chavez Zbur, who introduced the bills alongside Senators Ben Allen and Isaac Bryan, all Democrats.

As stated by Chavez Zbur, the proposed bills are intended to progress together and encompass modifications that will position California as a leader among other states and nations. The primary focus of this legislation is job creation, with Chavez Zbur emphasizing the need for modernization in these programs: “We understand that we must bring these programs up-to-date.

The announcement comes after Governor Gavin Newsom revealed plans last year to significantly increase California’s existing cap for a program offering tax breaks to the entertainment industry, as part of a determined effort to stimulate production throughout the state, which had been severely impacted by strikes, and counteract the long-term trend of film and television productions moving away from the region.

As a gamer, I felt a growing sense of urgency to enhance the program after the devastating wildfires in Los Angeles. These fires cast a shadow of uncertainty over an already dim production landscape, potentially eroding even more of LA’s share in filming. One of the main worries is that these fires could drive away more workers from the entertainment industry, further draining California’s creative pool.

According to the most recent data from the local movie production office FilmLA, Los Angeles’ film industry is making a strong comeback. During the three-month stretch from October to December, there were increases in virtually all categories of filming, with the exception of reality television, which continued its downward trend for the ninth consecutive quarter. Last year, the area recorded only 23,480 shoot days – the second lowest number since FilmLA began tracking outside of the pandemic-induced halt in 2020.

As a passionate supporter, I’m excited about the prospect of California’s proposed subsidy becoming law. If it does, this state’s generosity would outshine all others, except for Georgia, which doesn’t cap its annual contributions to productions. The expansion could potentially bestow an astonishing $3.75 billion in tax credits upon our industry from 2025 through 2029.

Nevertheless, whether productions decide to film in California at previous rates will hinge on modifications made to the program beyond just raising its limit. This could involve expanding the range of eligible expenses and production categories for tax credits, or even boosting the highest possible subsidy a single title can receive.

If approved, California’s subsidy will be one of the most generous among all states, second only to Georgia, which doesn’t limit the amount it provides annually. The proposed expansion could potentially grant up to $3.75 billion in tax credits to the industry over a five-year period, beginning in 2025.

More to come.

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2025-02-27 02:24