HOLLYWOOD — Showing strong support for Hollywood on the runaway production front, the California State Assembly has backed tax credit legislation for projects filmed in California.
“Other states and countries are stealing — piece by piece –California’s crucial film and television production business,” said Speaker Herb Wesson, author of AB 2747. “We must act now or we will lose this multibillion-dollar industry, and along with it, the jobs that California residents depend on.”
The Assembly passed the bill on a 68-1 vote, sending the measure to the State Senate. AB 2747 creates a 15% wage-based tax credit for the first $25,000 paid to each employee involved in production of a California-based film.
The credit, which would go into effect in July 2004, would be available for productions with budgets between $200,000 and $10 million. The Franchise Tax Board calculated the bill will cost a total of $415 million during its five-year life, or $15 million in the 2004-05 tax year and $100 million in each of the next four years.
Davis proposed bill
Gov. Gray Davis first suggested the bill, which mirrors proposed federal legislation, in January amid strong support from Hollywood unions and the Motion Picture Assn. of America. He designated 2004 as the start date in order to allow for the state to recover from its current budget deficit.
As part of the legislative push this year, Hollywood’s guilds and unions formed the California Coalition for Entertainment Jobs.
“AB 2747 is designed to level the playing field, securing that film and television production stay within the state,” declared Joseph A. Aredas, chair of the coalition and international rep in charge of the West Coast for IATSE. “Wage-based tax incentives allow California to remain competitive when vying with other states and countries for production.”