LOS ANGELES — Movie studios would be eligible for a long-sought perk under Gov. Gavin Newsom's proposal to let them convert a portion of their state tax credits into cash payments, essentially creating a government subsidy for Hollywood that California doesn't offer to any other industry.
If Newsom's plan is passed by the Legislature and signed into law, California's film tax credit program would become "refundable" in 2025 — meaning that on top of giving qualifying film and TV productions credits that wipe out their state tax liability, the state also would give them payments totaling tens of millions of dollars a year.
The boost would help bring more film productions to California amid competition from other states, the Newsom administration argues. And it's structured to incentivize Hollywood to increase the diversity of its workforce — a goal of the Democrat-dominated Legislature, which is itself more diverse than ever before.
