The entertainment industry is warning Gov. Gavin Newsom that the state risks undermining California production if it imposes a new limit on corporate tax credits.
In a June 8 letter, a coalition of industry and labor groups argued that the governor’s budget proposal will cost production jobs and sabotage the state’s film incentive.
“The result will not be theoretical — it will be immediate and concrete,” the letter states. “This impact will be felt across the entire production ecosystem,” adding that the measure poses “a direct and immediate threat to tens of thousands of middle-class jobs.”
Responding to a dramatic downturn in film and TV production, Newsom more than doubled the state incentive to $750 million last year. But the governor’s budget for the upcoming fiscal year would limit companies’ ability to claim tax credits, which the entertainment groups argue defeats the purpose of the expansion.
The coalition, including the Motion Picture Association and the Hollywood unions, is pushing for a carve-out that would exempt film credits from the new limitation.
