CA Tax Incentive 2025

California’s proposal to increase its tax incentive has just gotten one step closer to passing: It passed in California’s Senate. Next step it will move to the State Assembly on Thursday. If it does, CA will increase its tax incentive from 25% to 35% for projects shooting in LA to lure more productions back to the state.

What’s worrying, though, is that language about doubling the amount of money allocated to the program from $330M to $750M has been removed.

The Senate’s bill proposal would extend the tax credit to:

• TV shows with episodes running 20 min (previously: 4o min)

• animation films, series, shorts, and large-scale competition shows (with budgets of $1M or more)

• Double tax incentives to $750 M

This increase from the current $330 M/year would help bring production back to the state after COVID, labor strikes, an M&A hellscape, and the wildfires.

This is much needed, as the film industry's dire contraction has driven production jobs out of California. TV shows filmed in LA are down 22.8%, and streaming shows are down 28%.

Recently,the California Film Commission awarded a record 43 indie films with tax credits:

If the proposal passes, it will go into effect July 1st, 2025. Yet the final budget number may not be decided for some time.