In a major win for the local movie and TV production industries, California has extended the state’s film tax incentive program to 2025, adding five years to the program that has helped stem the tide of runaway productions to states including Georgia, Louisiana and New York.
The measure, which was part of Gov. Jerry Brown’s $201.4-billion budget plan that was signed Tuesday, will maintain the $330 million in annual tax credits handed out to selected productions. But it includes more tax credits for independent films and additional incentives for projects that hire labor outside the 30-mile radius around Los Angeles.
The California Film Commission, which is in charge of selecting productions that receive credits, praised the new extension as a boon to the state’s economy.
“The new five-year extension signed into law today provides assurance that California will remain competitive, which means more employment for in-state crew members and production spending here at home where it belongs,” said Nancy Rae Stone, tax credit program director at the California Film Commission, in a statement.
California raised the annual tax credit amount to $330 million from $100 million in 2016.
Filmmakers can recoup as much as 25% of their spending — up to the first $100 million — on crew salaries and other qualified costs, such as building sets. Star salaries and other so-called above-the-line compensation don’t count. Studios can then use the credits to offset state tax liabilities in California.
The program has helped boost TV production around the state, including several series that have relocated from out of state.
Major Hollywood movies have also taken advantage of the program, including such upcoming titles as Disney’s “Captain Marvel,” Paramount’s “Bumblebee” and Sony’s “Once Upon a Time in Hollywood,” directed by Quentin Tarantino. But the majority of big-budget studio movies continue to be filmed away from California, in Atlanta, Toronto, London and other cities.
“The renewal of the tax credit will allow us to sustain the high level of filming taking place in California, and keep tens of thousands of middle-class Americans gainfully employed,” said Paul Audley, president of FilmLA, the organization that oversees film permitting.
“California recognizes the need to be competitive in the world marketplace of filmmaking and we are grateful for the continued support.”