Alberta Cuts Projected Hollywood Film Tax Credit Subsidies

Is Canada’s reputation for film tax credit stability about to be dinged?

That question has come up after energy-rich Alberta slashed by $35 million to $60 million the province’s anticipated financing for its Film and Television Tax Credit to support local and foreign producers shooting locally. The western Canadian province, where the popular HBO drama The Last of Us was shot during its first season, says no foreign movie or TV series looking to shoot locally will be turned away going forward.

“The Film and Television Tax Credit remains well funded at $60 million,” Hunter Baril, press secretary for the Ministry of Jobs, Economy, Trade and Immigration in Alberta, said in a statement to The Hollywood Reporter. That follows on Feb. 28, Alberta in its the latest provincial budget announcing a “$35 million reduction to the Film and Television Tax Credit” as it shifted projected funding from the FTTC to other government departments to drive economic growth.

“Reducing the allocated amount in Budget 2026 allows the ministry to increase funding for other programs instead of it going unused in the FTTC,” Baril added. As a bellwether, MGM Television Studios recently announced that an eight-part TV drama for MGM+ based on a reimagining of the 1960 western film The Magnificent Seven and to star Matt Dillon will start production in Calgary, Alberta in June 2026.

It’s understood the Hollywood studio anticipates no disruption to its plans to shoot in Alberta as it awaits confirmation in writing that the province will make good on its promise for a future FTTC rebate for MGM. Alberta’s FTTC offers a refundable tax credit on eligible production and labor costs, with rates of 22 percent or 30 percent, depending on how much principal production takes place in the province.

But while the projections cut for the FTTC is pitched as an accounting measure, and not a cap on the program, the budgetary line item move reflects an energy-rich Canadian province dependent on royalties from oil exploration and drilling and grappling with falling tax revenue to fund government expenditures.   A sharp fall in the global oil price before this week’s Middle East war effectively pinched Alberta’s tax receipts to the point the province now projects operating deficits in each of the next four years.

Dylan Pearce, an Edmonton-based indie producer and board chair at the Alberta Media Production Industries Association, said the $35 million reduction in planned provincial support for the film and TV tax credit should not impact local and foreign producers as it only impacts how much funding Alberta has set aside for its film tax credit program based on fluctuating production levels and payouts on the FTTC in recent years.

“There’s no actual cut to funding … It’s an estimate number,” Pearce told THR. Alberta paid local and foreign producers through the FTTC $26.7 million in 2023, and then $103.3 million in 2024, before $55.3 million was paid out in 2025.

That ebb and flow in film tax credit support has come as Alberta drew foreign location shoots for U.S. TV series like HBO’s The Last of Us, where the zombie apocalypse drama turned Calgary and other provincial locations into dystopian wastelands. That production shoot coincided with the global price of oil rising and briefly hitting $120 per barrel in spring 2022.  

Alberta also hosted western-themed dramas like Netflix’s The Abandons and Fargo and Prime Video’s Billy the Kid season 2, where the province offered American producers diverse rural settings like mountains, badlands, prairies and foothills. But global oil prices have since come back down to earth, leaving Alberta without a tax revenue windfall to invest in drawing Hollywood to produce locally.

Blair Young, president of ACTRA Alberta, which represents local union performers, said of the $35 million reduction to the FTTC in a statement: “While the budget announcement was not what we were hoping for, ACTRA remains committed to collaborating with government and industry stakeholders to ensure Alberta continues to be seen as an attractive and competitive place to shoot and prioritizes the growth and engagement of our skilled local performers.”

That’s as Alberta has become shy about breaking the bank to keep pace with rival jurisdictions like British Columbia and Ontario where generous film tax credits continue to draw American producers looking for foreign locations as part of production hubs in Vancouver and Toronto. “Predictions are always risky, but it does seem likely that Alberta will lose productions to jurisdictions that offer a better deal,” Charlie Keil, principal professor of the Cinema Studios Institute at the University of Toronto, tells THR.

He adds the war currently underway in Iran and the surrounding oil-rich Gulf States could yet boost oil prices to the point Alberta, a major oil producer on its own, will have more tax revenue to put towards film tax credits and other production subsidies. But until then, Alberta, which prides itself on being fiscally conservative, will manage expectations on Hollywood possibly shooting locally to keep creatives and crews in the province busy.

“Most Canadian production centers cannot subsist on homegrown productions alone. What will Alberta do to ensure that its production infrastructure won’t lie fallow? That sunk cost investment — not to mention the knock-off revenue that comes from having visiting production personnel spend money in Alberta — will be lost, so that loss has to be part of the calculation,” Keil added.  

While the first season HBO’s popular video game adaptation The Last of Us made use of Alberta for extensive location shooting, the second season saw production largely move from Calgary to Vancouver, where the third season of the popular series gets under way locally this week. On Canada’s west coast, most film and TV production is represented by service productions where a Canadian company produces an American or foreign project for a fee, and for the most part without retaining ownership rights.

That makes foreign producers tapping film tax credits crucial to whether they set up locally, or go to rival jurisdiction with more generous incentives and local producers having to take up the slack to keep soundstages and locations humming.