Newsom Puts $1B Film Credit On Table

California Governor Gavin Newsom announced a plan to raise the state’s film and television tax credit to at least $1 billion. The proposal was unveiled on Monday, November 2, the day before midterm elections. The current program caps annual credits at $750 million.

The new package includes several specific changes. It adds credits for above-the-line talent, which covers actor salaries. It sets aside $100 million annually for independent productions, an increase of $26 million from the current level. It offers a 5% boost in tax credits for companies that commit to at least two distinct qualifying productions in the state. It also extends the program’s lifespan from five years to ten, running through 2040.

Newsom has called for a larger increase in recent months. In 2025, the state raised its cap from $330 million to $750 million. Production levels in California continued to drop despite that hike. The governor’s office aims to reverse that trend with the larger incentive package.

Newsom also urged Congress to pass the federal Motion Picture, Television, and Entertainment Revitalization Act, known as MPTERA, by the end of 2026. That bill has bipartisan support. It would create a 20% base tax credit for qualifying film, television, and visual effects projects produced in the United States.

“California created the modern entertainment industry; we’re the capital of entertainment and we’re going to keep it here,” Newsom said. “At least $1 billion in tax credits means more investment flowing into our economy and more opportunity across the industry.” He added that states cannot shoulder the cost alone and called on Congress to pass the national legislation already on the table.

The governor’s office released data showing the current $750 million program has generated $8.24 billion in direct production spending. That total includes $5.3 billion in qualified expenditures and $3.2 billion in qualified wages. Those wages supported more than 43,000 cast and crew jobs.

The proposal lists funding caps for above-the-line spending. It describes the ten-year extension as a move to provide more predictability and support long-term production investment. The state currently holds the largest capped film and television tax credit in the United States.