Newsom proposes raising California film and TV tax credits to at least $1 billion
Business & MarketsWell-covered
|
The Facts
- Gov. Gavin Newsom proposed raising California’s annual Film and Television Tax Credit Program to at least $1 billion.
- California’s current annual film and television tax-credit allocation is $750 million.
- The proposal would make above-the-line compensation, including pay for actors and directors, eligible for credits.
- The proposal would reserve $100 million annually for independent productions.
- The proposal would extend California’s Film and Television Tax Credit Program through 2040.
- The proposal aims to retain film production and entertainment jobs in California amid competition from other jurisdictions.
- Companies committing to multiple qualifying California productions would receive additional incentives under the proposal.
Context
What does “above-the-line” compensation mean in this proposal?
It refers to pay for high-profile creative personnel, including actors, directors, writers and producers, which would become an eligible expense under the proposed credit expansion. POLITICO NY Post Sacramento Bee
How would the proposed program differ from the current one?
It would increase the annual allocation from $750 million to at least $1 billion, add eligibility for above-the-line talent, reserve $100 million for independent productions and extend the program through 2040. Los Angeles Times Variety KTLA 5
Why is California considering a larger production tax credit?
Newsom’s proposal is intended to keep productions and entertainment jobs in California as the state competes with other states and jurisdictions offering production incentives. POLITICO IndieWire news.bloombergtax.c…
Where Left and Right agree, and where they split
- Where Left and Right agree
- Both readings accept that California is competing with other jurisdictions for production jobs and that the expanded credit, including above-the-line pay, is a direct response to that competition.
- Where Left and Right split
- The left and the right split on whether saving film jobs justifies a bigger taxpayer-funded credit reaching top-paid talent.
- Why they won’t converge
- The divide is less empirical than about trust in the state picking industry winners: one side treats union-backed job retention as proof of good government, the other treats stacked incentives for an already-subsidized industry as proof of capture.
How left and right read it
The livelihoods at stake belong to crews, not only stars, and those jobs leave when the shoot does. With other jurisdictions pulling production away, holding at $750 million concedes ground, so lifting the allocation to at least $1 billion and extending through 2040 lets working people plan, while the $100 million reserved for independent productions keeps the benefit from pooling at the top. Defend the jobs rooted here.
“Los Angeles has been battered by years of runaway production, with film and television projects moving to other states and countries offering lucrative incentives.” — POLITICO
Public money belongs to taxpayers generally, not to one favored industry, and least of all to the people at the top of its pay scale. If studios need credits stacked on credits for committing to more productions, what exactly is the state buying?
“California Gov. Gavin Newsom wants to shower Hollywood with at least $1 billion in annual tax credits -- including new breaks for productions covering movie stars' salaries.” — New York Post
A jobs credit built to keep crews employed now also covers above-the-line pay, so retention policy doubles as a subsidy to top earners.
The receipts — 21 sources
Independent coverage (21)
The news, read by both sides.
The day’s biggest stories in one short brief, built to show both sides and the competing values behind the headlines. Free in your inbox.