California Gov. Gavin Newsom is aiming for major expansion to the state’s film and TV tax credit program, proposing to dramatically increase the annual credit from $750 million to $1 billion. That incentive has proved crucial to keep Hollywood projects — The Pitt ($24.2 million in recent credits), a Snoop Dogg biopic ($17 million), Ice Cube sequel Last Friday ($11.4 million in credits), Ang Lee’s Gold Rush era drama ($7 million), among many others — filming in state.
The politician, who’s also eying the Democratic nomination for the 2028 presidential cycle, also backed a bipartisan effort in Congress championed by Donald Trump to create a national film and TV tax incentive, which would stack along with each state’s individual credits. The announcement on Monday threw fuel on the fire to push Sacramento politicians to do more to help out the Golden State’s most iconic industry. And that effort to push the next round of bulked up incentives will fall to the next governor of California, likely Democrat Xavier Becerra if he defeats Republican Steve Hilton on Election Day this Tuesday.
“California created the modern entertainment industry; we’re the capital of entertainment and we’re going to keep it here,” Newsom stated on Monday. “At least $1 billion in tax credits means more investment flowing into our economy and more opportunity across the industry. 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.”
Newsom is proposing $100 million annually for indie
Newsom is proposing $100 million annually for indie productions and additional rewards for companies that “commit to more than one production in California.” Other states, including New Mexico and New Jersey, offer studio partner designations that confer additional tax benefits on companies that base production hubs in-state. All the major studios — from Disney to Paramount-Warner Bros. to Netflix to Sony to Amazon MGM — have their headquarters in Southern California.
Newsom and state officials are facing a dilemma. While California remains the top destination for Hollywood film and TV spending, its reign is being threatened by other major hubs. California saw $6.06 billion in spend compared with $4.63 billion in production spend in New York over the past 12 months, per industry tracker ProdPro’s latest report in October. But New York is growing much faster than California, up 87 percent in spending in the latest quarter to California’s 17 percent. And the Empire State saw morelive-action features budgeted over $10 million shooting last quarter than California (17 for NY vs. 13 for CA), ProdPro notes. Those projects include features like Universal’s Michael B. Jordan and Austin Butler actioner Miami Vice: 85.
Meanwhile, film and TV shoot days in Hollywood’s historic home, Los Angeles, are in a spiral despite efforts being made to cut red tape and boost incentives offered to productions to shoot locally. That downward trend line has been going since the dual writers’ and actors’ strikes halted production in 2023, but has not yet recovered as studios have kept pulling back content spend and cutting episode orders for TV shows.
The California Film Commission, led by outgoing director
The California Film Commission, led by outgoing director Colleen Bell, oversees the film and TV credit program, distributing the $750 million annually to major studio projects as well as numerous indie productions, including many with California-flavored plotlines that prominently showcase locations. Think: a Baywatch reboot shot in Venice Beach or the Snoop origin biopic shooting in Los Angeles.
In a round of credits unveiled on Oct. 7, Pixar, Lionsgate and Paramount alone were granted about $100 million in California tax credits for projects including an untitled Pixar animated feature ($40.1 million), Lionsgate’s sequel to Michael ($30.8 million) and an untitled crime thriller from Paramount Pictures ($29.3 million).
“I’m grateful for Governor Newsom’s leadership and his call to expand California’s Film and TV Tax Credit to over $1 billion,” said director Bell. “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.”
Assemblymember Rick Chavez Zbur, a key legislator who
Assemblymember Rick Chavez Zbur, a key legislator who has been working with Hollywood proponents to fine-tune the state’s incentive program, praised Newsom’s call and said the increased incentive is aimed at “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.”
There’s no guarantee, however, that throwing more money at the problem will work. California has already upped its annual film and TV tax credit from $330 million to $750 million in a major legislative push in 2025 that saw Newsom describe the move as a lifeline for the state to compete against Canadian competitors like Toronto and Vancouver or New Zealand, the U.K. as well as U.S. hubs. “We put our feet up, we took things for granted,” he said at a bill signing event at Warner Bros.’ The Ranch Lot Studios in Burbank just last July.
