A bipartisan group of four US Congress members has introduced a bill to extend and strengthen Section 181, the closest thing the US currently has to a national film and TV production tax incentive.
The Creative Relief and Expensing for Artistic Entertainment – or CREATE – Act would extend the Section 181 provision, currently set to expire at the end of this year, to the end of 2030. It would also increase the amount of production costs to which the provision can be applied to $30m or $40m, depending on production location, and introduce an annual inflation adjustment.
The act was introduced by Representative Judy Chu, a Democrat from California, Representative Nicole Malliotakis, a New York Republican, Georgia Democratic Senator Raphael Warnock and Tennessee Republican Senator Marsha Blackburn.
Groups including the Motion Picture Association (MPA), the Independent Film and Television Alliance (IFTA) and the leading US film guilds and unions, as well Jon Voight, Special Ambassador from Hollywood to US president Donald Trump, expressed their support for the bill.
In its current form, Section 181 gives US producers who meet spending and labour requirements the ability to claim accelerated depreciation on production costs up to $15m, rising to $20m in some locations. The provision’s expiration at the end of 2025 has been seen as another blow to the effort to stop the flight of film and TV production away from the US to countries with wide-ranging production incentives, such as the UK and Australia.
The extension of Section 181 was one of the proposals included in a letter sent to Trump in May by US trade groups, Voight and his fellow Hollywood ambassador Sylvester Stallone.
Industry insiders have also recently been discussing the possibility of introducing a more extensive national incentive for the US, one that might bring more international shoots into the US (the Section 181 depreciation must be applied against US income, so mainly benefits US-based producers).
Announcing the introduction of the new act Representative Chu said: “I’m so proud to introduce the CREATE Act, bipartisan, bicameral legislation to support good-paying, domestic creative jobs by extending and strengthening Section 181, the only federal tax incentive specifically designed for film, television, and sound production here in the United States. With Section 181’s expiration fast approaching in just a few months, it’s so critical to not just extend this deduction, but strengthen it. Our bill would do just that and would ensure that the United States continues to invest in the incredible talent that exists in my district in Southern California and across the country.”
Representative Malliotakis added: “I join Rep Judy Chu in introducing this bipartisan legislation aimed to help keep film and television production here in the US especially in New York, a major entertainment hub with studios in both Brooklyn and Staten Island. New York’s film and television industry has generated thousands of jobs and promotes economic activity in our district through series like Ray Donovan, Gotham, Boardwalk Empire, Blue Bloods, and Fallout to name a few. Our effort has earned the support of President Trump and industry leaders like Jon Voight, making clear just how important it is to keep production companies from leaving our community and country for overseas incentives.”
MPA chairman and CEO Charles Rivkin said: “Extending and strengthening Section 181 will lead to more domestic film and TV production, and more American jobs. The MPA applauds Senators Blackburn and Warnock, alongside Representatives Malliotakis and Chu, for introducing the bill in their respective chambers and looks forward to Congress enacting this vital legislation.”
IFTA president Jean Prewitt said her organisation “strongly supports introduction of legislation.”
Read the full bill text here.
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