California Gov. Gavin Newsom has proposed increasing the state’s annual film and television tax credit from $750 million to $1 billion, arguing that the expansion could help keep more Hollywood productions in California and support the state’s entertainment workforce.
The incentive has already helped attract projects including The Pitt, which received $24.2 million in credits, a Snoop Dogg biopic with $17 million, Last Friday with $11.4 million, and an Ang Lee drama set during the Gold Rush era with $7 million.
Newsom also supports a bipartisan effort in Congress, championed by Donald Trump, to establish a national film and television tax incentive. Such a program would operate alongside individual state credits. Newsom said federal action was necessary because states should not have to bear the full cost of competing for productions.
“California created the modern entertainment industry; we’re the capital of entertainment and we’re going to keep it here,” Newsom said on Monday. He added that an expanded credit would bring more investment into the state and create additional opportunities across the industry.
California remains the leading destination for Hollywood production spending, but its position faces growing competition from markets including New York and New Jersey, as well as international locations such as the United Kingdom, which has expanded its soundstage infrastructure. At the same time, the number of filming days in Los Angeles has continued to decline despite efforts to reduce administrative barriers and improve local incentives.
Colleen Bell, the outgoing director of the California Film Commission, praised Newsom’s proposal, describing the existing tax credit as an important tool for increasing in-state production, supporting crews and strengthening California’s creative economy.
The expansion is not guaranteed to reverse the trend. California increased its annual film and television credit from $330 million to $750 million in 2025, when Newsom described the measure as a lifeline in the state’s competition with Toronto, Vancouver, New Zealand, the United Kingdom and other production centers. At the time, he acknowledged that California had taken its dominance for granted.
Sources: The Hollywood Reporter.