California Gov. Gavin Newsom (D) unveiled a new tax credit program for film and TV this weekend in the hopes of bringing production back to Hollywood.
The proposed tax plan will “boost the state’s tax credits from their present level of $330 million a year to around $750 million annually,” announced Deadline on Sunday.
The whooping increase will not take place immediately, and is subject to approval by the Democratic majority legislature in the Golden State’s 2025-2026 budget. However, in this election year of close down ticket races, Sunday’s announcement is intended to swell confidence locally for an industry and a workforce that has seen production in L.A. and across the state dramatically shrink and jobs dry up over the last year or so, sources say.
Los Angeles Mayor Karen Bass has voiced support for the tax credits to increase film production in Hollywood. One industry insider told Deadline that the current tax program, which offers 20-25 percent tax credits for production needs a serious overhaul to meet industry needs.
“So many productions don’t even apply because there is such a slim chance they’ll be successful. And the industry, the crews and content delivery methods have changed dramatically over the past 10 years, so what the state offers doesn’t meet basic needs, and barely competes with Atlanta or Canada,” the insider said.
In a press conference on Sunday, Gavin Newsom hailed the proposed plan as an investment in the film industry’s future.
“California is the entertainment capital of the world, rooted in decades of creativity, innovation, and unparalleled talent,” said Newsom in a statement. “Expanding this program will help keep production here at home, generate thousands of good-paying jobs, and strengthen the vital link between our communities and the state’s iconic film and TV industry.”
Mayor Karen Bass likewise said that the new tax plan shows California will have Hollywood’s back.
“Hollywood is the cornerstone of this city and our economy and our message to the industry today is clear – we have your back,” said Mayor Bass. “When I was Speaker of the California State Assembly, I worked to support leaders like now-Councilman Paul Krekorian to create the film tax credit. Despite the economy being in a difficult spot, we knew that the industry needed support, and if we could at least start the program, then we could grow it. Today I’m proud to stand with Governor Newsom and industry leaders to continue this important work supporting this legacy industry.”
A recent study from FilmLA showed that film and TV production “dropped by 5% in the third quarter of 2024 compared to the same timeframe of 2023,” per KTLA.
The Hollywood Reporter recently dubbed Los Angeles a “production graveyard”, warning: “Every category of filming for scripted content trails historical norms.”