California‘s film and TV production tax incentive plan could undergo significant changes, as a growing competition arises between states trying to attract Hollywood productions.
On Tuesday, lawmakers put forward an amended bill, aiming to raise the annual program cap from $330 million to $750 million. This proposed bill includes a significant increase in the tax credit to 35%, as well as expanding the types of productions that can qualify for this benefit. The updated list now includes shorter TV shows, animated series, and certain genres of unscripted projects.
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On Tuesday, lawmakers presented an updated version of a bill intended to boost the yearly program cap from $330 million to $750 million. This new version suggests increasing the tax credit to 35%, along with broadening the range of productions eligible for this incentive. The expanded criteria now encompasses shorter TV series, animated programs, and specific categories of unscripted projects.
If enacted, the bill (SB 630) would mark some of the largest modifications to the program since its establishment in 2009. The legislation was prompted by a severe decline in state filming, attributed to contraction within the industry and productions choosing to film elsewhere for better tax incentives. Unlike many competitive filming hotspots such as New York, Georgia, and the U.K., California currently offers only a 20% base credit, which is less attractive compared to other regions.
Following the amendment, a refund of 35% is granted to productions for expenses incurred within the state. Moreover, an extra 5% credit can also be claimed when filming takes place in designated regions outside of Los Angeles.
To stay competitive with other regions expanding their subsidized productions, the program will now accept TV shows that consist of two or more episodes, each lasting a minimum of 20 minutes. Previously, only series with episodes of at least 40 minutes were eligible. Other productions such as sitcoms, animated films, series or shorts, and “large-scale competition” shows (excluding reality, documentary, game, or talk shows) may now qualify for credits under the revised bill, provided they have a budget of at least $1 million.
Lawmakers additionally suggest abolishing the rule mandating an independent incentive for soundstage construction, where the owner holds over 50% stake or has signed a lease lasting no less than ten years.
California is still confronted with intense rivalry from other areas enhancing their tax breaks for the film industry. Unlike other significant production centers, it doesn’t allow expenses related to upper-level roles such as actor, director, or producer to be eligible for incentives.
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2025-03-26 21:25