Hollywood Legislators Still Confident in Tax Credit Expansion Despite Caution Over California Budget

California Gov. Gavin Newsom's expansion of the state's film and TV tax credits program to $750 million is still on track despite warnings from the state's legislative analyst that budget deficits could balloon to as much as $30 billion by 2028-29.

Last week, the California Legislative Analyst's Office (LAO) projected a deficit of $2 billion for the 2025-26 fiscal year in its annual fiscal outlook, a massive improvement from the $68 billion deficit the Golden State faced this past year. The budget is expected to be balanced with minor changes.