A proposed federal tax credit for film and television production could generate an additional $125.3 billion in U.S. production spending and support an average of 143,500 full-time-equivalent jobs annually through 2035, according to an industry-commissioned study released Tuesday.
The Motion Picture Association commissioned global screen-sector consulting firm Olsberg SPI to examine the potential economic effects of a federal production incentive amid increased competition for film and television production.
The study modeled a 20% federal tax credit for money spent employing U.S. workers, with an additional 5% for labor costs in federally declared disaster areas and another 5% for independent production companies.
The model assumed a minimum production expenditure of $1 million and a Jan. 1, 2027, effective date.
The report stressed that there is no formal government proposal for a federal incentive and described the model as an illustrative scenario based on a publicly reported industry-supported proposal. It also assumed existing state production incentives would remain unchanged.
The push for a federal production incentive has been building for more than a year and received a boost last month when President Donald Trump called on Congress to approve tax incentives for the entertainment industry. Trump said the proposal followed discussions with actor Jon Voight, one of his Hollywood ambassadors.
Under the study’s assumptions, U.S.-based production spending would total about $277.5 billion from 2027 through 2035 with the federal incentive, compared with about $152.2 billion without it — a difference of roughly $125.3 billion.
The additional spending would generate an estimated $249.1 billion in gross value added and $133.1 billion in labor income over the nine-year period, according to the study.
Researchers projected an annual average of 153,700 additional jobs, equivalent to about 143,500 full-time-equivalent jobs when varying work patterns and temporary or contract employment are taken into account.
The report said 39 states operated active film and television incentive programs as of August, with some supplemented by regional or county programs. The United States does not have a national production incentive.
According to the study, 65 countries have national production incentives. It cited Canada and Australia as major production markets where national and sub-national incentives can be combined.
The study’s projections depend on several assumptions about the future of global and U.S. production.
Without a federal incentive, researchers assumed the U.S. share of global feature-film production spending would decline to 25% by 2035 and its share of television production would fall to 29%.
With the proposed incentive, the model assumed the U.S. share would rise to 65%, reaching that level by 2030 for film and 2032 for television.
Researchers also assumed global production spending would grow by 3.7% annually.
The report noted limitations to its projections, including that the economic model does not account for future policy changes, macroeconomic changes or potential responses by other countries, such as strengthening their own production incentives.