2025 Film Funding and Incentives: What’s Happening Worldwide
Here’s a deep dive into recent, major funding and incentive developments shaping the global film and TV landscape. and there have been plenty. Things are heating up in the US funding and incentive wise, with a slew of new measures aiming to secure a slice of coveted production budgets. These initiatives help various states stay competitive, fight off productions lost to other parts of the country or overseas, and provide a much-needed boost to local economies.
Domestically, Los Angeles has become known for being expensive for productions, long driving projects out of the state but that may soon change as California finally takes steps to support its struggling industry. Elsewhere in Europe, with the looming threat of film tariffs, there’s been a fresh wave of much needed incentives and support, alongside production and industry challenges in markets such as Germany, Spain and South Africa.
Texas Brings in Ambitious Film and TV Incentive Bill
Texas has brought in a bill to make the US state more attractive to film productions, to help the state stop losing productions to regional rivals: New Mexico, Louisiana, and Georgia. Championed by Governor Greg Abbott, SB 22 established a healthy $150 million a year fund. Whilst this will not position Texas to be able to compete with the top film production destinations like California, New York, and Georgia, it is a big win for the state. According to Variety, this fund will allow it to be in the same field as states including Louisiana and Pennsylvania, which each have subsidies to consistently attract production.
With a total of $1.5 billion investment up until 2023, this marks the state’s most ambitious support for positioning Texas as a regional hub for productions. Stars with connections to Texas including Matthew McConaughey, Woody Harrelson, Renée Zellweger, and Billy Bob Thornton backed the True to Texas campaign, urging lawmakers to take action, championing the economic and cultural returns of local production.
California: More Golden Opportunities for Film Productions
After losing productions in increasing competition to other states, California has made a decisive move to reclaim its place as the premier hub for film and television production. The state legislature, led by Democrats, has approved a significant increase in annual tax incentives, more than doubling the previous $330 million to a hefty $750 million. This boost is part of a wider tax bill poised to be signed by Governor Gavin Newsom, who has championed this measure as a necessary response to years of production migrating to other regions like Britain, Canada, and various US states offering attractive financial perks.
Industry professionals, from producers and directors to actors and crew, have been sounding the alarm that Hollywood risks a terminal decline, losing its status as a powerhouse and crippled by overseas competition. With this new funding, California hopes to stem that tide, sending a clear message: the world’s most iconic film industry is willing to invest to make sure it protects its future.
New York – Is Not Letting Its Position Slip
A state budget increased the cap for film and TV subsidies to $800 million, nearly doubling the amount from 2022. Through this expansion, $100 million of this subsidy has been ring-fenced for independent productions, showing the value they have in supporting that sector over the bigger players. This includes subsidies of $20 million for projects with budgets less than $10 million and $80 million for projects with budgets more than $10 million.
New York Gov. Kathy Hochul has approved a state budget that increases the cap on the state’s film and TV subsidy to $800 million, nearly double the amount from 2022. The measures also iron out past problems voiced by the industry including delays in receiving the credit and restrictions over the eligibility for above-the-line costs.
Louisiana Enacts Significant reforms to Film Tax Credit Program
Louisiana has enacted significant reforms to its film tax credit program with the passage of Act 44, signed into law by Governor Jeff Landry on June 4, 2025. Effective July 1, 2025, the legislation increases the base tax credit from 30% to 40% for qualified productions and removes previous per-project and per-person credit caps. Additionally, the law grants Louisiana Economic Development (LED) the authority to adjust incentive rules through administrative processes, enhancing flexibility to attract large-scale and episodic productions. While the annual credit cap remains at $125 million, the reforms aim to bolster Louisiana’s competitiveness in the film industry
The changes come in response to a significant downturn in the state’s film industry, with only one active production reported as of May 2025. Industry leaders, including Film Louisiana President Jason Waggenspack, have expressed optimism that the enhanced incentives will attract major studios and create long-term employment opportunities. However, some filmmakers have raised concerns about the broad discretionary powers granted to LED, fearing potential inconsistencies in incentive allocations. Despite these concerns, the reforms are seen as a critical step in revitalizing Louisiana’s status as a prominent filming location and supporting the local creative economy
Los Angeles Film Production on a Decline
So let’s go back to California and look at what the challenges have been for the industry.
Film production in Los Angeles has declined sharply, with a 30% drop in location shoots over the past five years, reaching one of the lowest points in decades. Rising costs, complex permitting processes, and competition from other regions offering generous tax incentives have driven productions away. Industry professionals are advocating for increased tax credits and regulatory reforms to revitalize local production and job opportunities.
Whilst the proposed $7.5 billion tax credit program to boost domestic film production is a promising sign, this is competing with concerns over the $12 billion budget deficit of the state, and raises concerns about diverting funds to Hollywood subsidies. The future of LA as a film hub depends on the state’s willingness to adapt amid fierce global competition.
Several international markets reveal contrasting fortunes as they roll out new incentives or grapple with systemic challenges with infrastructure to support productions and rebates being paid on time.
Jordan: Rebate of Up to 45% Announced at Cannes
During the Cannes Film Festival, Jordan revealed a more robust financial incentives program for film and TV productions. Announced by The Royal Film Commission, it confirmed that Jordan’s new cash rebate will cover 25–45 percent of the in-country spend for qualifying film and TV projects, compared to the 25 percent cap so far. Projects with production expenditures in excess of $10 million and featuring Jordanian culture are eligible for the upper-end rebate of 45 percent. Using a points-based system, The Royal Film Commission added that productions will be assessed on the project’s size, incorporation of Jordanian cultural content, and its artistic, cultural, and economic value.
South African Productions With Unpaid Claims
South Africa’s 25% cash rebate program for film production is in crisis, as reported in Variety. Government delays at the Department of Trade, Industry and Competition (DTIC) have left hundreds of rebate applications stuck, with millions in unpaid claims owed to local filmmakers — some pending for years. This bottleneck is stalling projects and draining confidence in the industry’s financial framework to support productions.
Industry bodies demand a streamlined, transparent, and reliable rebate system with clear timelines and reduced bureaucracy. The lack of communication and support from the DTIC threatens jobs, economic contributions, and the sector’s post-pandemic recovery. While big players like Netflix help sustain production, many projects shy away due to rebate uncertainty, forcing producers to rely on South Africa’s cost advantages instead. Recent talks of a working committee offer a glimmer of hope, but the industry remains anxious about long-term stability.
Meanwhile, over in Europe they have equally been busy, where just as in North America, film funding and attracting productions and supporting the industry has been in the in tray of many governments.
UK Offers Supports to a Struggling Sector
The UK government has introduced a £500 million Screen Growth Package to bolster the film and television industry. This initiative includes a £50 million Creative Places Fund aimed at supporting regional film and TV production, enhancing infrastructure, and fostering local talent. The package also features a £150 million investment in AI-driven special effects research, with labs established at Pinewood Studios and other locations. These efforts are part of a broader strategy to grow the UK’s creative industries by £50 billion and create 1 million jobs by 2030.
The Screen Growth Package is designed to strengthen the UK’s position as a global leader in film and television production, attracting international projects and supporting domestic talent. By investing in infrastructure, research, and regional development, the government aims to ensure the industry’s long-term sustainability and competitiveness.
The UK Screen Growth Package has been warmly welcomed by the domestic film and TV industry as a much-needed boost after a challenging period since the pandemic and the knock-on effects from strikes in the US. While it’s seen as a positive step toward regional development and international competitiveness by many, some voices in the sector feel it doesn’t go far enough. There are calls for stronger tax incentives and additional support measures continue, reflecting ongoing concerns about the sustainability and distinctiveness of UK screen content in a rapidly changing global market. There are also calls for a cultural levy on streaming services, to ensure the long-term sustainability of the UK’s screen sector.
German Industry Hopes for Better Deal for Films
The German film industry is increasingly frustrated with slow progress in implementing new incentive reforms aimed at attracting international productions. Despite the reform of the German Film Act earlier this year, the promised tax incentives and obligations for streaming platforms to invest in local productions have yet to be fully established. This is leading to valid fears in this competitive market that productions will shift with this delay to other European countries like France or Spain, and has already seen a drop in the number of international projects.
Bavaria’s Prime Minister Markus Söder, speaking at the Munich International Film Festival at the end of June, called for swift action to maintain Germany’s competitiveness. A big hurdle to this is the federated system in Germany, which requires coordination between the federal government and the 16 states, hindering the incentive reforms rollout. Meanwhile, The Hollywood Reporter stated production service companies are already facing financial difficulties due to the drop in international projects. The industry will reassess progress at the Hamburg Film Festival industry days in late September.
The Hollywood Reporter also covering the story says this adds to an already rough year for German producers. Theater admissions fell 5.8 percent to 90.1 million in 2024, a much sharper drop than in most Western European countries, and domestic titles took just 20.6 percent of the market, a 3.7 percent drop.
Over One Billion in Production Spend for the Netherlands
In the annual Monitor on the Economic Effects of the Film Production Incentive, it revealed that the Netherlands Film Production Incentive, over a decade from 2014 to 2024, generated over €1.04 billion in production spend for the country’s audiovisual industry. This means for every euro paid out through the incentive, this led to a four times value for the economy, with €4.08 spent within the country, benefiting local crews, facilities, and suppliers. The scheme also encouraged cross-border production, with more than half of the productions being made through international co-productions.
Italy: Tougher Provisions for Tax Credit
The Italian Ministry for Culture has introduced new tougher provisions regarding tax credit for national and international productions, to boost transparency and scrutiny of tax relief. This means from now on in order to obtain full approval of tax credit, productions will need to present a complete copy of their finished work. The beneficiaries of these incentives will also need a current account just for managing tax relief cash flows, in order to ensure their full traceability, which will be further enhanced by the provision that all invoices for upwards of 1,000 euros must display the title of the work in question. Furthermore, The Film and Audiovisual Department can demand a report on the appropriateness of the eligible costs declared, which might also be used to assess the transferability of tax credit. They have also reinforced the rules already in place, around staff recruitment and outsourcing services to external parties.
Hungary Rebate Continues to Make it Competitive
Hungary has increased its film rebate budget to attract international productions, offering a 30% tax rebate, one of the most competitive in Europe. The country has temporarily paused new registrations for its film rebate program due to a surge in applications following recent law changes. The annual budget cap was quickly reached, leading to a backlog. Parliament is considering further amendments to reopen registrations and manage the demand more effectively.
Despite this pause, Hungary remains open and operational for international film productions, with ongoing projects and a commitment to maintaining its status as a global filming destination.
Spanish Woes Affect the Whole Industry
Foreign investment in Spain’s film industry has dropped sharply in 2024, falling 33.6% compared to the previous year — from €197.4 million in 2023 to €129.9 million. This decline saw 27 international projects across nine Spanish regions, down from 37 projects the year before. PROFILM, representing major Spanish production companies involved in international shoots, reported these worrying figures at an event in Barcelona with the Catalunya Film Commission.
The report also reveals its impact on the labour force and ancillary services, with a 16.5% decrease in new hires, from 10,747 to 8,510 workers. Key sectors affected include accommodation (€13.3 million), technical equipment rental (€9.1 million), and location fees (€6 million), alongside travel, visual effects, set design, and transport services. These figures underline the broad economic impact foreign film productions have on Spain’s local industries.
Japan Extends 50% Rebate until End of 2025
Japan’s Ministry of Economy, Trade and Industry has decided to keep its production incentive program going through 2025, holding steady on that eye-catching 50% cash rebate. It’s a clear sign the country wants to keep building on its growing reputation as a prime filming destination.
Confirmed by the Visual Industry Promotion Organization (VIPO) and the Japan Film Commission, the program has already supported ten international productions in 2024 including Apple TV+’s Monarch: Legacy of Monsters Season 2. This latest extension means the incentives will be available from March 27, 2025, all the way through to January 31, 2026.
Industry Reactions to US Tariff Proposals
In light to the US proposal to impose 100% tariffs on foreign-made films, some countries and markets New Zealand has already responded with a boost and to offset potential headwinds and fallout.
New Zealand – Boosts Rebate For International Productions
According to Reuters, New Zealand has announced an additional NZ$577 million (approximately US$339 million) to its International Screen Production Rebate scheme. The rebate program, introduced in 2014, offers a 20% cash rebate on production costs exceeding NZ$15 million for feature films and NZ$4 million for television productions. Finance Minister Nicola Willis emphasized that continuing this support is necessary to sustain offshore investment in New Zealand’s screen industry, which employs approximately 24,000 people and generates NZ$3.5 billion annually, with about one-third of its revenue coming from the United States.
New Zealand is positioning itself as a competitive alternative for international film productions by bolstering its rebate program, in a market where the likes of Australia, Canada, and the UK offer more generous incentives. This move aims to attract Hollywood and other global studios, leveraging its renowned talent pool and picturesque locations to offset the impact of the proposed U.S. tariffs.
LA Times: Opinion Piece on the Impact of Tariffs
Alexis Alexanian, a New York City-based film producer, in a guest op-ed in the LA Times argues that President Trump’s proposal for 100% tariffs on all films into the US doesn’t only harm competitive film markets or outsourcing studios — it harms smaller countries, for many of which cinema is a lifeline. Alexanian argues such a tariff would affect the global film ecosystem, which is now far more international, where co-productions between countries are far more common particularly in Europe, especially where they have a shared language.
That is why the U.S. has benefited from this and is also frequently involved in co-productions with the anglophone world including Britain as well as Canada. Belgium has 72% of its films in partnership with foreign nations, often France. Other examples of co-production leaders include Luxembourg (45% with France), Slovakia (38% with Czechia), and Switzerland (31% with France). Israel too has leaned into this model, using agreements with countries such as France, Germany, and Canada to gain access to international audiences and funding mechanisms.
