Key Takeaways for Entertainment Professionals
- Massive Tax Credit Expansion: California’s annual film & TV tax credit jumps from $330M to $750M.
- More Jobs for Creatives: The expanded program could add 4,400–5,500 new film industry jobs.
- Greater Incentives for Diverse and Regional Productions: Credits increase for filming outside LA and hiring from underserved communities.
- New Eligibility: Sitcoms, animation, and large-scale competition shows are now included.
California Approves $750M in Film & TV Tax Credits: What It Means for Creatives
In a monumental win for the entertainment industry, California lawmakers have greenlit a major expansion of the state’s Film & Television Tax Credit program—raising the annual budget to $750 million, more than double the previous $330 million cap. This landmark decision aims to revive and retain film production in California, while encouraging greater regional diversity and inclusive hiring practices.
Governor Gavin Newsom’s proposal, first introduced in October amid a production downturn, has now gained full support from Senate and Assembly leaders. A formal vote to solidify the expansion is expected shortly.
Why This Tax Credit Expansion Matters
California has long been the heart of the entertainment industry, but recent years have seen production fleeing to states like Georgia, New York, and New Mexico due to more generous incentives. The new tax credit boost is a strategic move to reclaim California’s competitive edge.
According to the California Film Commission, the additional funding is expected to increase film-related job opportunities by 40–50%, which equates to 4,400 to 5,500 new jobs.
AB 1138: What’s Changing in the Program?
A key part of the expansion is Assembly Bill 1138, a companion measure that enhances the scope and generosity of the program:
Increased Credit Percentages
- Base credit rises from 20% to 35% per project.
- Productions filmed outside Los Angeles County could earn up to 40% in tax credits.
Expanded Eligibility
- Sitcoms, animated productions, and large-scale competition shows can now qualify—broadening opportunities for content creators across genres.
New Diversity Incentives
- Productions hiring 1–4 trainees from workforce development programs in underserved communities can earn an additional 2% bonus.
- Workforce training will be opened up to more nonprofit partners in the coming year.
Enhanced Reporting Requirements
- Productions must now report on employee ZIP codes in addition to race, ethnicity, gender, and veteran status—helping to track and foster geographic and demographic inclusion.
Regional Equity: Pushback from Non-L.A. Filmmakers
While the updates are broadly welcomed, independent filmmakers outside of Los Angeles have voiced concerns. The Out of Zone Coalition, representing creatives from the Bay Area and other regions, argued that the original program disproportionately favored L.A.—home to over 90% of the state’s industry jobs.
Though they lobbied for a 10% bonus for non-L.A. productions, lawmakers instead settled on a more modest 5% outside-L.A. boost. However, that clause was ultimately dropped in favor of the new 2% workforce training bonus, ensuring some equity-based incentives remain.
What This Means for Aspiring Talent and Independent Productions
For aspiring actors, producers, and independent filmmakers, this expansion signals major opportunities:
- More productions staying in-state means more casting calls, crew roles, and post-production gigs.
- Animation and sitcom creators now have a viable path to tax credit support.
- Producers outside L.A. can still benefit from regional bonuses and targeted workforce incentives.
- Talent from underserved communities may find increased access through training and mentorship programs linked to the tax credits.
Final Thoughts
California’s decision to invest $750 million annually in its Film and TV Tax Credit Program reflects its renewed commitment to supporting local storytelling, expanding workforce diversity, and anchoring its role as the epicenter of the entertainment industry. With AB 1138 expected to pass by July 4 and take immediate effect, creatives across the state should gear up for a wave of new projects, opportunities, and funding.
