California Film Tax Incentives Drive 10% Production Surge as Rival States Compete

California is fighting back against runaway production. Governor Gavin Newsom signed a law in July that doubled the state’s film tax credit. This move has already sparked a noticeable shift. According to industry tracker ProdPro, the state saw a 10 percent year-over-year increase in shoots during the third quarter. The data was shared with The Hollywood Reporter.

The boost aims to reclaim productions lost to other states. California’s annual incentive fund now stands at $750 million. This significant financial commitment is designed to attract both big studio films and independent projects.

California’s Production Boom: Quantity Over Budget?

The increase in shoot numbers tells only part of the story. Despite more projects choosing California, overall production spending fell by 10 percent. It dropped to $1.5 billion in the third quarter. ProdPro analysts attribute this to a shift in project types. More independent films are now shooting in the state.

These indie projects typically have smaller budgets than major studio titles. The latest round of state-approved incentives reflects this trend. Only 10 big-budget studio projects, like “Heat 2,” received credits. Meanwhile, 42 independent films were approved. Of those, 32 had budgets under $10 million.

How Other Production Hubs Are Performing

California is not alone in seeing growth. Its major competitors also reported increases in filming activity. New York state experienced a 17 percent jump in shoot count. However, its production spend also fell sharply. New Mexico’s shoot count rose by 25 percent.

The real standout is New Jersey. The Garden State saw filming counts spike by 100 percent. Its production spend soared an incredible 170 percent to $400 million for the quarter. This surge comes ahead of new studio hubs planned by Netflix and Paramount. In contrast, Georgia experienced a significant downturn. The state saw a 33 percent decline in both shoot numbers and production spend.

The national picture shows a 15 percent rise in U.S. film shoots. Yet the global outlook remains cautious. ProdPro estimates total global production spend will fall by about 7 percent next year.

The competition for film and television production is intensifying. California’s expanded tax incentives are clearly making an impact, setting the stage for a fierce battle for Hollywood’s dollars.

Thought you’d like to know

What is California’s new film tax credit amount?

California has doubled its film and TV tax incentive program. The annual fund now totals $750 million. This is up from the previous $330 million cap.

Why did production spending in California fall?

Spending fell despite more shoots because of a shift to independent films. These projects have smaller budgets than major studio blockbusters. They therefore employ fewer crewmembers and incur lower overall costs.

Which state saw the largest growth in production?

New Jersey recorded the most dramatic growth. It saw a 100 percent increase in shoot counts. Its production spend also skyrocketed by 170 percent in the third quarter.

How did Georgia’s production industry perform?

Georgia experienced a significant decline. The state saw a 33 percent drop in both filming activity and production spending. This is attributed in part to major franchises like Marvel moving productions elsewhere.

What is the global production forecast for 2025?

Industry analysts project a decrease in global spending. ProdPro estimates total production spend will be around $41.6 billion for 2025. This represents a 7 percent decrease compared to the previous year.