Lawmakers in California have approved the plan to more than double annual funding for the state’s tax credit programme to $750m, according to reports, though a formal vote is still a few days away.
The increase in annual funding from the current $330m was first proposed by state Governor Gavin Newsom last October, as a response to the continuing production slump that has affected the state since the 2023 Hollywood strikes.
But the $750m figure was not included in the 2025-2026 state budget that lawmakers approved earlier this week. Instead, the figure has had to be introduced in a ‘trailer bill’ to the budget. While a final vote on that bill will not come until later this week, legislators are now understood to have reached a budget agreement that includes the boost.
When the budget is finally approved, the increased funding will come into effect on July 1, along with the so-called 4.0 version of California’s Film & Televsion Tax Credit Programme. Also expected to be passed is a bill boosting the credits to be offered under the programme from 20% or 25% to 35% and opening the programme to animated features and some kinds of unscripted television.
In recent weeks, as the state’s budget negotiations have gone down to the wire, filmmakers have been lobbying to secure the funding increase, with names including Patty Jenkins and Jonathan Nolan visiting state capital Sacramento to talk to legislators.
The massive funding increase is intended to make California’s tax incentive programme more competitive with those offered in states such as Georgia and New York, and overseas locations including the UK.
When he first proposed the increase, Newsom said: “California is the entertainment capital of the world, rooted in decades of creativity, innovation, and unparalleled talent. Expanding this program will help keep production here at home, generate thousands of good-paying jobs, and strengthen the vital link between our communities and the state’s iconic film and TV industry.”
News that the increase had been approved was first reported by Variety.