Congress bets on a 20% tax credit to keep cameras in the US
Republicans and Democrats in Congress have joined forces to try to keep film and television shoots in the United States with a new 20% federal tax credit.
The bipartisan bill was introduced on 24 September 2026 by Sens. Tim Scott and Adam Schiff and Reps. Nathan Moran, Linda Sanchez, Jonathan Jack and Laura Friedman, according to the House release. It would amend the Internal Revenue Code to create the first national incentive for American productions. The credit would cover 20% of labour costs for US film and television projects spending at least $1 million, according to Spectrum Local News.
The sponsors say the United States risks losing the industry to foreign competition. That warning is familiar in state capitals. California lawmakers acted to more than double annual film and television incentives to $750 million, according to Reuters. After the COVID-19 pandemic Gov. Gavin Newsom had temporarily boosted the state credit to $420 million a year. California later awarded credits to 28 new films, including an upcoming feature from Oscar-winning director Ang Lee.
The sums involved can be large. The TV series `The Pitt', shot at the Warner Bros. lot, received $12.2 million in tax credits for each of its first two seasons. Texas increased its own incentive last year, with bonuses for faith-based projects and films promoting Texas heritage. California also reached a separate tax deal that falls short of a full carveout for entertainment from a $5 million annual limit on corporate tax credits.
The federal push is now tied to the fight over Paramount's bid for Warner Bros. Discovery. Paramount chief executive David Ellison sought to buy Warner Bros. Discovery without conditions, while California Attorney General Rob Bonta sought to block the deal outright or force divestitures, according to Variety. Newsom pushed for a resolution of the antitrust case out of fear the studio would leave California. Opponents of the merger said on 20 September that state leaders had caved to that threat. Newsom has denied that he pressured Bonta to settle, telling Fox News he did not intervene in the attorney general's decision.
The resulting consent decree, a court-enforced settlement, is unusually detailed for Hollywood. Paramount must release at least 30 films a year and negotiate Warner Bros. Discovery and Paramount cable carriage contracts, the deals that put channels on pay-TV systems, as separate entities. The company committed to keep ownership of its studio lots and accepted five years of government monitoring, plus an oversight board described as a watchdog for news networks CBS and CNN.
One clause links the two stories directly. Paramount must quadruple its US production volume if a federal subsidy is adopted. That promise gives Ellison a stake in the outcome of the Scott-Schiff-Friedman bill.
For viewers, this means the argument is about where cameras roll. A national credit would sit on top of state programmes rather than replace them.
Other disputes are still live. Paramount asked a US judge to require the 12 states opposing the merger to post a $1.88 billion bond, a financial guarantee to cover damages if their challenge fails, according to Reuters. The Department of Justice sided with Paramount in that fight. A Paramount shareholder has separately sued David Ellison and Larry Ellison, alleging they cut an "illegal" deal with President Trump to win approval. Trump had earlier floated both tariffs on films made overseas and low-interest bonds for Hollywood film-makers.
