Bipartisan Lawmakers Introduce 20% Federal Film Tax Credit to Combat Global Subsidies

Key points

• The MPTERA bill offers a 20% base federal tax credit on qualified labor compensation for film and TV productions with total costs exceeding $1 million and at least 75% of production days in the U.S.
• Bonus credits of 5% each (up to a 30% total) are available for productions in rural opportunity zones, federally declared disaster areas, independent productions, or those spending at least $10 million across 10 or more states.
• The credit is transferable to other taxpayers and can stack with existing state incentives, though it excludes news, live sports, talk shows, social media content, and non-labor expenses.
• Co-sponsors include Senators Tim Scott (R-SC) and Adam Schiff (D-CA), and Representatives Linda Sanchez (D-CA), Brian Jack (R-GA), Nathaniel Moran (R-TX), and Laura Friedman (D-CA).
• IATSE and the Motion Picture Association (MPA) strongly support the bill, with IATSE calling it a 'gamechanger' for 170,000 behind-the-scenes workers and urging swift passage before year-end.
• President Trump endorsed the legislation in August 2026, providing significant momentum, though the House is in recess and the Senate is about to adjourn, making passage during the lame duck session the primary hope.

Background

The push for a federal film incentive gained momentum after President Trump publicly supported the idea in August 2026, following years of advocacy by industry unions and the Motion Picture Association. Jon Voight, serving as Trump's 'ambassador to Hollywood,' also played a role in lobbying for the measure. The bill aims to address the loss of tens of thousands of U.S. production jobs to countries with more generous subsidies, with proponents arguing it could create 143,500 jobs and double the industry's value by 2032. California and other states have attempted to compete with their own incentives but have struggled to match global offers.

How outlets are covering it

Deadline and Variety highlight the bipartisan nature of the bill and the broad industry support, including endorsements from IATSE, the MPA, and the Directors Guild of America. IATSE emphasizes the labor-based nature of the credit and its potential to restore middle-class jobs, while Variety provides a detailed breakdown of eligible and excluded content, noting that unscripted series with a four-episode minimum are included. Critics, such as the Wall Street Journal, argue that federal subsidies for Hollywood are unnecessary 'handouts,' while some industry insiders in Deadline's comments section question whether the credit will offset higher U.S. healthcare costs compared to countries with universal healthcare. Schiff noted that the bill's passage could be delayed if it is 'kicked to next year' depending on the outcome of the midterm elections, but emphasized the current momentum from the president's endorsement.

Why it matters

The MPTERA bill represents a significant shift in U.S. policy toward supporting the film and TV industry, aiming to reverse the trend of runaway production to countries with more generous subsidies. If passed, the 20-30% federal tax credit could make U.S. locations more competitive globally, potentially retaining tens of thousands of jobs and boosting local economies. The bill's transferability and ability to stack with state incentives could provide substantial financial relief to producers, while the exclusion of certain content types ensures the credit targets traditional film and TV production. However, the bill's passage remains uncertain due to legislative timing and political opposition, with critics questioning the cost and necessity of federal subsidies for Hollywood.

What to watch

Lawmakers hope to pass the MPTERA bill during the lame duck session at the end of 2026, potentially by attaching it to a major funding bill. IATSE is launching a nationwide advocacy campaign to push for swift passage, while the Motion Picture Association and other industry groups are mobilizing support. The outcome of the midterm elections could influence the bill's trajectory, with Schiff noting that a change in congressional control could delay passage to 2027. Proponents are emphasizing the current momentum from President Trump's endorsement and the bipartisan support for the measure.