California Gov. Gavin Newsom is proposing expanding the state’s film and TV tax credit program to at least $1 billion.
The move, which comes as the state prepares to elect Newsom’s successor during this week’s midterm elections, would include credits for above-the-line talent, $100 million for independent productions, a 5% boost in tax credits for companies that commit to more than one production in California, and an extension of the tax credit through 2040.
He is also urging Congress to pass the Motion Picture, Television and Entertainment Revitalization Act (MPTERA) by the end of the year
“California created the modern entertainment industry; we’re the capital of entertainment and we’re going to keep it here. At least $1 billion in tax credits means more investment flowing into our economy and more opportunity across the industry,” Newsom said in a statement. “Through this expansion, we will maintain the momentum and success of our historic expansion last year. But states can’t shoulder the cost alone, which is why I am calling on Congress to back up an expanded tax credit by passing national film and TV tax credit legislation already on the table.”
Since its inception in 2009, California’s Film and Television Tax Credit Program has generated over $35.4 billion in economic activity and supported more than 248,000 cast and crew jobs across the state. In years past, for every $1.00 of tax credit awarded, California has seen $24.40 in economic output, $16.14 in gross domestic product (GDP) and $8.60 in wages.
Last year, the annual credit was raised from $330 million to $750 million last year, a $3.75 billion investment over five years through 2030.
Since the expansion, the program has delivered $8.25 billion in direct production spending to date, including $5.3 billion in qualified expenditures and $3.2 billion in qualified wages. It has also created over 43,000 cast and crew jobs and increased film and TV shoot days by 52% and more than 7%, respectively. There have also been more than 8,600 filming days in the state, including 1,823 “out-of-zone” days.
But Hollywood has lost over 50,000 industry jobs in the past six years as California has been battered by the COVID-19 pandemic, wildfires, dual labor strikes from SAG-AFTRA and the Writers’ Guild of America, media consolidation and increased competition from overseas and other states like New York and Georgia who have wooed series and films with sweetened production incentives.
“I’m grateful for Governor Newsom’s leadership and his call to expand California’s Film and TV Tax Credit to over $1 billion,” California Film Commission Director Colleen Bell said. “The California Film and TV Tax Credit has become one of our most important tools to increase production in California, support crews and strengthen the creative economy that makes this state the entertainment capital of the world.”
“I’m grateful to Governor Newsom for his unwavering commitment to the workers and small businesses that are the backbone of California’s iconic film and television industry,” Democrat Assemblymember Rick Chavez Zbur added. “While we’ve made tremendous progress, we must continue building on that momentum to ensure California remains the film and television capital of the world. This is about protecting the future of an industry that has helped define California for generations and ensuring the next generation of creative workers and small business owners can raise their families right here at home.”
