Income tax: credits: commercial production.

The Personal Income Tax Law and the Corporation Tax Law allow various credits against the taxes imposed by those laws, including numerous motion picture credits. This bill, for taxable years beginning on or after January 1, 2027, would allow a credit against the taxes imposed by those laws to a qualified taxpayer that produces qualified commercials, as defined, in the state in an amount equal to 20% or 30% of the qualified production costs attributable to the production of a qualified commercial, as specified. The bill would exclude any commercial that is created entirely by generative artificial intelligence, as specified, and would require the qualified commercial to adhere to specified labor standards. The bill would require the California Film Commission to establish an application process and allocate the credits on or after July 1 each year, in accordance with certain requirements. The bill would limit the aggregate amount of credits that may be allocated for a fiscal year under these provisions to $15,000,000. The bill would require specified certifications under penalty of perjury. By expanding the scope of a crime, this bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. This bill would take effect immediately as a tax levy.