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By Gavin Boyle
California approved $342 million in tax incentives across 52 movies, including multiple hit franchises that will greatly benefit from reduced production costs.
“I have long looked forward to the day when the California Film Incentive would help us bring movies like this one back home – and now that it does, I am so grateful that ours will be among the first to take advantage of the new program,” said Jake Kasdan, the director of JUMANJI who is now working on a sequel. “Making these big popcorn movies requires hundreds of specially-skilled people, and the world’s finest live in California.”
Earlier this year, California passed a sweeping expansion to its tax credit system, allowing movies to now qualify for up to $48 million in savings, nearly doubling the previous limit of $25 million. The expansion also greatly increased the budget for the program and the state is now set to dole out $750 million to TV show and movie productions over the next five years.
Related: Hollywood Teeters on Collapse as Workers Call for More Tax Credits
These changes were the result of a rapidly changing production space as hundreds of productions have left the state in pursuit of cheaper costs. Many other states and countries have offered lucrative tax credits in recent years which have suddenly made California one of the most expensive places for a project to be produced. The expansion to the state’s tax credit system was a bipartisan effort to quickly respond to this issue and help keep production in L.A. before it was too late.
“FilmLA is elated with the news of the passage of the California Film & Television Tax Credit Program by the California State Legislature,” Film LA president Paul Audley said in a statement after the bill to expand the tax credit system was passed. “We are grateful to our partners and collaborators across the industry and in government who joined together to advocate for a stronger, modernized, and revitalized California where production can thrive once again.”
Nonetheless, there is no guarantee that California will be able to recapture the production business it has already lost. 40,000 production jobs have already left the state as studios have looked to film elsewhere, and the expanded tax credit is only expected to add back 5,000 jobs.
California lawmakers, however, will not go down without a fight, and believe that more people will return than expected, partially because there is a steady rate of production in L.A., meanwhile productions have to constantly move locations to chase tax credits in other places. Ultimately, they believe many in the industry will choose the stability for themselves and their families found in California over constantly moving to work with a production.
While there is still work to be done, it is encouraging to see how the expanded credit system is helping keep major production in L.A. and giving the city a fighting chance to remain the production capital of the world.
Read Next: Will California’s Film Tax Credit Bill Help ‘Working Families’?
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