By: Gabriel Papadopoulos
Producing a major motion picture today can cost a fortune. This year’s Oscars Best Picture nominees displayed how drastic the gap in movie production budgets can be with Dune: Part Two ($190m) and Wicked ($145m) each reaching nine figure budgets while other nominees like The Brutalist ($10m), I’m Still here ($1.5m), and the award winner Anora ($6m) cost much less to make.[1] Major motion pictures have reached an average cost of $100 million while television shows tend to range from $10-135 million per season.[2] With these enormous costs, production businesses have to carefully consider where to film, and one major factor is tax incentives. State governments can provide a variety of tax breaks towards the film industry in the form of grants, rebates, refundable credits, or even transferable tax credits, which allow a business to sell an unused portion of the tax break to a private buyer.[3]
Georgia, a state not historically associated with the film or television industry, has become a haven for filmmaking and even earned the moniker the “Camera Ready State” thanks to expansive tax credits.[4] As of 2021, Georgia earned $4 billion from its entertainment industry thanks to major productions like Stranger Things, the hit Netflix show set in the fictional town of Hawkins, Indiana, but filmed across Georgia.[5] The show’s fourth season employed over 2,000 local crew members, purchased over 15,600 hotel night stays, and used over forty filming locations in Georgia, with direct spending of over $190 million in the state.[6] Georgia has attracted other large-scale projects like The Walking Dead and Avengers: Endgame while bringing an estimated 20,000 new jobs to the state.[7]
Changes to Look For –
Several states, including California, New York, Texas, and Nevada, have proposed new bills to expand their current tax incentives and revitalize their entertainment industry.[8] California especially lost out this year due to what some say is an outdated tax credit system, as all ten Oscar nominees for the 2025 Best Picture Award were filmed outside of California.[9] Governor Gavin Newsom has been pushing hard to “amend, update, and modernize,” taking California’s film credit budget from $330 million to $750 million annually.[10] State Senator Ben Allen, a sponsor of the legislation to expand, noted that 77% of film productions unable to obtain a tax credit in California decide to film elsewhere, which has led to nearly $1 billion in losses.[11]
Lawmakers in New York, Nevada, and Texas are hoping to roll out their own new increased budgets.[12] The governor of New York, a state that lost out on the Bob Dylan biopic A Complete Unknown starring Timothée Chalamet (largely set in New York) to New Jersey’s more favorable benefits, has introduced changes that would increase the state’s benefits budget to $800 million a year while also creating new programs to incentivize reoccurring production.[13] Governor Hochul’s proposed changes would also provide up to $100 million for independent films like Anora, which was primarily set and shot in New York City.[14]
Film studios that leave the U.S. to seek better incentives overseas are also a major threat.[15] Multi Oscar winning The Brutalist, starring Adrien Brody, is the story of a Jewish architect who comes to the U.S. after World War II.[16] Most of the film is set in Pennsylvania, but it was filmed almost entirely in Hungary for less than $10 million, made possible by the nation’s 30% tax incentives.[17] Dune: Part Two was also filmed in Hungary, while The Substance, set in Hollywood, was filmed entirely in France, which offers as high as 40% for tax rebates.[18]
Critics of these incentives believe the return states get from providing such incentives isn’t enough to make up for the lost tax revenue.[19] Nonetheless, increasing tax breaks has proved successful for states like Georgia, which has seen a meteoric rise in film industry business and tourism thanks to its expansive tax incentives.[20] While providing more tax incentives and breaks may help attract new business, several states providing better benefits will also increase competition and give film studios more filming destinations to choose from.[21] However, increased competition could be a big issue for states providing tax incentives with the goal of establishing a permanent business model.[22] Whether and where this legislation is passed will greatly impact the future of the film/entertainment industry for several states and will undoubtedly affect state’s economy and tourism industry.[23]
[1] See Abigail Stevens, All 10 Oscars 2025 Best Picture Nominees, Ranked By Box Office, Screen Rant (Feb. 1, 2025), https://screenrant.com/oscars-2025-best-picture-nominees-box-office-ranked-list/; Film Budget of Oscars Best Picture Nominees 2025, Film Budget https://filmbudget.com/oscars-film-budget/ (last visited Mar. 29, 2025); Tim Lammers, ‘Wicked’ Ends Its Theatrical Run. How Much Did Hit Movie Musical Make?, Forbes (Mar. 14, 2025), https://www.forbes.com/sites/timlammers/2025/03/14/wicked-ends-its-theatrical-run-how-much-did-hit-movie-musical-make/.
[2] Film Industry Tax Incentives: State-by-State, Wrapbook (Sept. 30, 2024), https://www.wrapbook.com/blog/film-industry-tax-incentives.
[3] See id.
[4] See Anna Keizer, 10 Best States for Film Tax Incentives & Tax Breaks, Wrapbook (Aug. 26, 2024), https://www.wrapbook.com/blog/film-tax-breaks.
[5] ‘Stranger Things’ Season 4: How Georgia Economy Benefited from Latest Installment of Sci-Fi Series, Ga. Dep’t of Econ. Dev. (June 13, 2022), https://georgia.org/blog/stranger-things-season-4-how-georgia-economy-benefited-latest-installment-sci-fi-series.
[6] See id.
[7] Tax Notes Talk, How Tax Incentives Drive the Film Industry, Tax Notes (July 25, 2024), https://www.taxnotes.com/tax-notes-live/tax-notes-talk/how-tax-incentives-drive-film-industry/7khw3.
[8] See Michele Miller, Maximizing Your Film and TV Production Budget with Tax Incentives in 2025, Greenslate (Mar. 3, 2025), https://greenslate.com/blog/state-by-state-film-tv-production-tax-credit-updates; Pooja Salhotra, Texas is Poised to Become a Film Haven – But Not Without a Fight, Texas Trib. (Mar. 12, 2025), https://www.texastribune.org/2025/02/14/texas-film-incentives-tax-credit/ (elaborating on the Texas Senate’s proposal of a $500m budget over two years).
[9] See Danielle Muoio Dunn, Best Picture Nominees Filmed With Tax Credits Far From Hollywood, Bloomberg L. (Feb. 28, 2025, 4:45 AM), https://www.bloomberglaw.com/product/blaw/bloomberglawnews/bloomberg-law-news/XC4VATU8000000?bc.
[10] See S.B. 630, 2025-26, Reg. Sess. (Cal. 2025); see also Katie Campione, California Lawmakers Introduce Bills To “Modernize” Film & TV Tax Credit Program in Conjunction with Newsom’s Proposed Expansion, Deadline (Feb. 26, 2025, 3:42 PM), https://deadline.com/2025/02/california-bills-introduced-modernize-film-tv-tax-credit-1236303100/.
[11] See id.
[12] Miller, supra note 8; Salhotra, supra note 8.
[13] See Jon Campbell, Gov. Hochul’s Plan to Keep Hollywood Producers in NY? An Even More Generous Tax Credit, Gothamist (Mar. 7, 2025), https://gothamist.com/news/gov-hochuls-plan-to-keep-hollywood-producers-in-ny-an-even-more-generous-tax-credit; Miller, supra note 8.
[14] See Miller, supra note 8; Senator Jeremy Cooney (@SenatorCooney), X (Mar. 3, 2025), https://x.com/SenatorCooney/status/1896614285524271185.
[15] See Dunn, supra note 9.
[16] See Christopher Vourlias, How Hungary’s Versatile Locations, World-Class Artisans and 30% Tax Incentive Brought ‘The Brutalist,’ ‘Maria,’ ‘Dune 2’ and Other Oscar Contenders to Life, Yahoo (Nov. 30, 2024, 11:58 AM), https://www.yahoo.com/entertainment/hungary-versatile-locations-world-class-165825044.html.
[17] See id.; EJ Tangonan, The Brutalist Director Reveals He Didn’t Make Any Money on the Academy Award-Nominated Film, JoBlo (Mar. 4, 2025), https://www.joblo.com/the-brutalist-director-money/.
[18] See Dunn, supra note 9.
[19] See Salhotra, supra note 8.
[20] See Keizer, supra note 4 (mentioning that Georgia has the second best program of any state and even provides an additional 10% credit just for using their “Made In Georgia” logo in the film’s end credits).
[21] See Salhotra, supra note 8.
[22] See Campione, supra note 10 (noting that California has been losing film industry business partially due to increased tax credits from several jurisdictions such as Georgia, Nevada, and the UK).
[23] See Keizer, supra note 4 (highlighting that state tax breaks are crucial to the economics of filmmaking).
