California lawmakers propose amendments to film tax credit program

California film tax credits AB 186 Hollywood production incentives SB 122 entertainment industry legislation

California lawmakers have introduced Assembly Bill 186 to amend the state's film and television tax incentive program. The move follows concerns from the Motion Picture Association and entertainment unions that recent budget legislation, specifically Senate Bill 122, could stifle industry growth by capping annual business tax credits at $5 million or 70% of total liability.

AB 186 seeks to mitigate these restrictions by providing several concessions. Notably, the bill would fully exempt credits for independent films from the annual cap. It also aims to improve liquidity for major studios by accelerating the payback period for those opting to monetize tax credits for cash, reducing the period from five years to two years and lowering the associated discount from 10% to 5%.

Additionally, the legislation proposes extending the carry-forward provisions for tax credits from 10 to 15 years. These changes are intended to maintain California's competitiveness as a global entertainment hub following the recent expansion of the state's production incentive program to $750 million.

Entities

California · California State Legislature · Entertainment Union Coalition · Gavin Newsom · Motion Picture Association

Claims

What the coverage asserts, and how many sources carry each claim.

[● 2 SOURCES] The proposed legislation fully exempts credits for independent films from the annual tax credit cap. yve-style.com
[● 3 SOURCES] California lawmakers introduced AB 186 to amend the state's film and television tax incentive program. yve-style.com · www.thewrap.com
[● 2 SOURCES] Senate Bill 122 established a cap on annual business tax credits at $5 million or 70% of total liability, whichever is greater. www.thewrap.com
[● 2 SOURCES] The state's film and television tax incentive program was recently expanded from $330 million to $750 million. www.thewrap.com
[● 2 SOURCES] The bill reduces the discount for studios refunding credits for cash from 10% to 5% and shortens the payback period from five years to two years. yve-style.com · www.thewrap.com
[○ 1 SOURCE] The new bill expands the carry-forward provisions for tax credits from 10 years to 15 years. www.thewrap.com

Sources

California Lawmakers Agree on Limited Tax Credit Relief for Filmmakers [yve-style.com]

14 days ago

Your Move, Mr. Governor: CA Post Production Tax Incentive Bill Passes State Senate; Moves To Newsom’s Desk [ca.news.yahoo.com]

12 days ago

California Lawmakers Reach Deal to Amend Production Tax Incentive Ahead of Deadline [www.thewrap.com]

14 days ago