Lawmakers patch a hole in California's film tax credit, for now
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Set us as preferred State lawmakers have approved a series of modest changes intended to bolster California’s film and TV tax credit program.Among the key revisions, independent filmmakers would be exempted from the $5 million state corporate tax credit cap that was approved earlier this year as part of Gov.Gavin Newsom’s state budget.Film industry advocates lobbied hard for a carve-out, saying the cap would undercut gains made under the current film and TV tax credit program at a time when Hollywood has been reeling from job losses.
Hollywood Inc.The story of how L.A.
steadily lost much of its homegrown industry to other locales is a tale of hubris, escalating costs, political inaction and fierce competition from states and countries hungry for a piece of the Hollywood pie.The exemption is a compromise.Film industry advocates were hoping all types of producers would be exempt from the corporate tax cap.
The bill includes other changes intended to help Hollywood, such as allowing companies to carry forward older tax credits for up to 15 years (the old limit was nine) and reducing the discount they are charged when they opt to seek a cash refund on unused credits.Producers will also be able to collect their refund money more quickly — within two years instead of five.California offers tax credits of up to 35% on qualified expenses, which can be applied to any tax liabilities the production companies have in the state.
The program allocates $750 million annually in film and TV tax breaks.The budget trailer bill was introduced to the Senate on Friday by Assemblyman Rick Chavez Zbur (D-Los Angeles), chair of the Assembly Democratic Caucus and Senator Ben Allen (D-Santa Monica).
The new cap, issued by Gov.Newsom, would have undermined the “competitiveness” of the current California Film and Television Jobs Program, s...