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When Regis Philbin started his career in show business 50 years ago, he watched the fledgling television and film industry flee New York City as the cost of production grew too high and space became too scarce. Politicians at the time considered giving a tax break to keep the businesses around, Philbin recalled, but ultimately decided to let them leave.

“I’ll always remember that argument, and to me, it was the biggest political blunder I’d ever seen in a major American city,” Philbin said.

Gov. George Pataki came to Queens Friday to pledge that he would attempt to correct that mistake, making permanent a program that gives a 10 percent tax credit to film and television productions in New York State as part of his 2006-07 Executive Budget.

Pataki joined Philbin, along with the cast of ABC series “Hope and Faith,” and network executives, at Silvercup Studios in Long Island City to announce the renewal of the tax credit, which they said has lured many filmmakers back to the Big Apple.

The tax credit had been a pilot program set to expire in 2008, but an almost-immediate flood of new business at New York film studios encouraged officials to establish the incentive as state policy. In 2009, the recent budget also calls for the credit to increase from $25 million to $30 million annually.

“It works. In the last year and a half, almost a billion and a half in economic activity happened in this great city and state because we are now competitive,” said Pataki, speaking from the set of a new NBC pilot, “Kidnapped.” “We have the creative talent, the stars, the producers, and now have the ability to attract those when they have to make a tough business decision to film in New York instead of Vancouver.”

Since the incentive was enacted in 2004, 53 feature films, 18 television series and seven television pilots have taken advantage of the tax credit, generating an estimated 12,000 jobs directly or indirectly linked to the film production, according to the Governor’s office.

Alan Suna, who started Silvercup Studios with his brother Stuart in 1980, said costs and other factors slowly caused a decline in interest to film in New York, but the tax credit has sparked a flurry of new production.

“It has been nothing less than fabulous,” Alan Suna said.