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Members of Congress are drafting legislation that would create a 20% federal film and TV incentive — with bonuses that could bring it as high as 30% — after President Trump endorsed the idea last week.
The bill is expected
to be introduced this month, and perhaps as soon as the end of next week, according to sources familiar with the process. Rep. Nathaniel Moran, a Republican from East Texas, is working on the bill with Rep. Linda Sanchez, a Democrat from Whittier, Calif. Both serve on the House Ways and Means Committee, which is responsible for tax legislation.
Rep. Laura Friedman, a Democrat from Burbank, Calif., has also been working with Rep. Brian Jack, a Republican from the Atlanta suburbs, on the bipartisan effort.
For the last year, the Motion Picture Association and entertainment unions have been advocating for an incentive that would compete with generous subsidies from the U.K., Canada, Australia and scores of other countries. Trump threw his weight behind the idea in a Truth Social post on Aug. 31, a development expected to unlock Republican support on Capitol Hill.
The draft legislation broadly aligns with the MPA’s request. The bill would offer a base credit of 20% of all labor costs, both below-the-line and above-the-line. A wide range of productions would be eligible, including reality TV and animation in addition to films and scripted TV shows, according to sources familiar with the legislation. It would not include news or sports broadcasts.
The bill would also include four “uplifts” meant to attract political support. According to a source, the bill would allow producers to claim an additional five percent if they meet one of these four criteria:
- film in a rural opportunity zone
- make an independent production
- bring a certain amount of filming back to the U.S. from abroad
- spend at least $10 million in 10 different states in a year
Producers could claim up to two of those uplifts, for a maximum of 30%. The federal tax credit would stack on top of state incentives, meaning that productions could see a total subsidy of 60% or more depending on where they film.
Supporters have argued that the incentive will not just help Los Angeles and New York — where the bulk of production takes place — but will also boost rural areas that currently have little filming and little or no state tax incentive.
The hope is that spreading production around will broaden support, much the way the state incentives in California and New York attracted votes from rural lawmakers by offering a bonus for filming outside of Los Angeles and New York City, respectively.
California lawmakers have also pushed for a bonus for any production in an area that was recently declared a federal disaster zone. (All of Los Angeles County would qualify due to the 2025 fires.) That is not included in the latest draft.
The tax credit could be used to offset federal income tax, or be sold to another taxpayer to offset their tax liability. It would not be refundable.
The bill has yet to go to the Joint Committee on Taxation, which will get a score on how much it would cost — though it is safe to say it will run into the billions of dollars. In his post last week, Trump argued that the cost would be “made up tenfold by the money pouring into the Treasury’s coffers.”
The MPA is expected to issue a report in the coming weeks that would expound on that claim, arguing that production creates a ripple effect that benefits the local economy.
Some supporters of the measure are optimistic about getting it through Congress as part of a tax bill during the lame duck session after the November election, though it may be more likely to happen next year.
“I would be very happy for it to happen in the lame duck,” Friedman said in an interview last week. “I can’t promise that’s possible. We’re going to try not only to get this done quickly, but to have all our ducks in a row.”
Friedman said that the discussions took on a new momentum after Trump got involved.
“I can’t tell you the number of texts that have come in from people who have offered to help,” she said.
She declined to discuss the specifics of the legislation, but said she is working to build a coalition across the country behind the idea.
“Everyone in every state loves movies and television,” she said. “Everyone benefits by this product being made here.”
