A bipartisan group of lawmakers unveiled federal legislation Thursday that would establish a 20% to 30% federal incentive for film and television production in the United States, escalating efforts to keep entertainment jobs and spending from moving overseas.
The proposed credit would be available on top of existing state tax incentives. If enacted and combined cleanly with those programs, the resulting subsidies would rank among the most generous available to film and TV producers worldwide.
“If it passes and it stacks clean, shooting in Georgia or California or New York is the best deal on the planet,” said Joe Chianese, senior vice president for incentives at Entertainment Partners. “Nothing overseas comes close.”
How the proposed credit would work
The legislation creates a 20% base credit covering all labor costs, including both above-the-line and below-the-line expenses.
Additional 5% increases would be available for independent productions and projects filming in rural areas, allowing qualifying productions to receive a credit worth as much as 30% of labor costs.
Los Angeles County would also be eligible for a 5% increase for the next five years under its status as a federal disaster area. That provision arrives as the region continues to confront a prolonged production downturn.
More than 50,000 jobs have been lost in Los Angeles alone during the past four years amid a historic industry slump. The decline has fueled calls for federal action to counter production incentives offered in the U.K., Canada and 63 other countries.
The bill follows a two-year campaign by Hollywood unions and the Motion Picture Association, which represents the major studios in its lobbying work. President Trump backed the push last month and called on Congress to act “immediately” on legislation intended to save the industry.
Rep. Nathaniel Moran, R-Texas, one of the bill’s sponsors, framed the proposal as an investment in domestic employment rather than a benefit limited to the entertainment business.
“If we want to keep American storytelling in America, we have to level the playing field, and that’s exactly what this bill does,” Moran said. “This isn’t about subsidizing Hollywood — it’s about supporting the American worker, one story and one production at a time.”
Supporters forecast jobs and industry growth
A Motion Picture Association study released last week projected that a federal incentive would double the country’s $20 billion film and television production industry by 2032. The study also estimated that the policy would create approximately 143,500 jobs.
Sen. Tim Scott, R-S.C., said the migration of production affects employment, investment and American cultural influence.
“We cannot stand by as more and more American film production moves overseas, taking jobs, investment, and an important source of American cultural influence with it,” Scott said. “This legislation will create jobs in communities across America, support local economies, and help ensure that the next generation of iconic American films is made right here in America.”
Sen. Adam Schiff, D-Calif., said he has spent years advocating for a federal incentive aimed at stopping entertainment jobs from leaving the country.
“Now, we have the best opportunity in decades to get it done,” Schiff said.
A changing incentives contest
The federal proposal would enter an already competitive network of production subsidies. Several states offer incentives of at least 30%, while California is debating whether to expand a state program currently set at 35% to 45% and capped at $750 million annually.
International competitors also continue to offer substantial benefits. Manitoba has one of the world’s most generous programs, with its credit on below-the-line labor reaching as high as 65%.
Manitoba film commissioner Lynne Skromeda said the full consequences of a U.S. federal incentive remain difficult to predict.
“The devil is in the details,” Skromeda said. “I think it definitely could have an impact. But Manitoba is the kind of place where you make it through no matter what.”
According to Skromeda, preliminary calculations by some local producers indicated that Manitoba could retain an advantage because of the currency exchange rate.
What Happens Next?
The legislation must still pass Congress, and its eventual effect may depend on how the federal credit works alongside individual state programs. Another open question is whether rival production centers will respond by enhancing their own incentives.
“There’s going to be some response,” Chianese said. “You have to imagine that the UK and Canada are going to do what they can to protect the industry they have.”