Film, TV Tax Credit Plan Renewed

Gov. Gavin Newsom has signed a bill to extend the state’s Film and TV Tax Credit program for an additional five years.

The tax credit program lasts through the 2030-31 fiscal year and will create an estimated 60,000 jobs and $10 billion of investment over that time frame. It will maintain the current level of $330 million in funding annually.

California’s entertainment industry drives economic growth in communities throughout the state, and over the years the tax credit program has helped create thousands of good paying jobs, relocated productions to California and brought billions in new investment to the state, Newsom said.

“Through the extension of the program, we’ll continue this growth, protect jobs, and push for progress on diversity so workers better represent communities throughout our state,” Newsom said in a statement about the extension bill, which he signed on July 10.

California Film Commission Executive Director Colleen Bell said the news about Newsom extending the tax credit program, which the commission oversees, is a testament to his leadership and the legislature’s commitment to the industry.

“For more than a century, our unmatched crews, talent, infrastructure and locations have made California the world’s entertainment capital,” Bell said. “The extension of our tax-credit program will strengthen our global competitiveness and deliver significant, long-term value to California’s economic future.”

Previous iterations of the tax-credit program have included television and feature film productions that have generated more than $23 billion in economic output and supported the employment of more than 178,000 cast and crew. The new state budget will create the state’s fourth generation tax-credit program, known as Program 4.0, according to the commission.

There have been some changes to the program.

Program 4.0 includes new workforce diversity provisions and increased funding for the film commission’s Career Pathways Training Program to help prepare residents from diverse communities for careers in the production industry.

“The program shall be funded by a fee equal to 0.5% of the approved credit amount for a qualified motion picture,” according to the bill. The previous fee had been for 0.25% of the approved credit amount.

To qualify for a full allocation of tax credits, participating projects will be required to file a diversity workplan and demonstrate a good-faith effort to hire a workforce that is “broadly reflective” of California’s population, according to the commission.

Additionally, Program 4.0 will contain a first in the nation Safety on Production Pilot Program, which involves a firearms-training requirement and the inclusion of a specialized advisor to monitor on-set safety. 

These new requirements are the result of the shooting death of cinematographer Halyna Hutchins in October 2021 on the New Mexico set of the movie, “Rust.” Hutchins died after being shot and killed by a bullet from a prop gun discharged by actor Alec Baldwin that was not properly checked.

And finally, for the first time since the initial program was launched in 2009, tax credits will be refundable, thereby allowing taxpayers with insufficient tax liability to make use of the credit beginning with the 2025-26 fiscal year.