Former President Donald Trump has proposed a controversial plan to impose a 100% tariff on foreign-produced movies entering the United States. He posted this announcement on Truth Social. He mentioned his concerns for the state of America’s film industry, which he describes as “dying a very fast death. We’re especially excited about the proposal to strengthen the U.S. Department of Commerce’s authority. It allows the Trade Representative to start the process of imposing this hefty tax.
Trump’s announcement hits at a moment when Tinseltown is facing a series of economic pressures. He accused other nations of “stealing the movies and movie-making capabilities from the United States,” suggesting that such actions have contributed to the industry’s struggles. The proposed tariffs would be levied on foreign produced films coming into the U.S. It’s unclear if they’ll go after US film corporations that make films abroad.
The potential impact of Trump’s proposal has raised alarms among U.S. film producers, particularly as they prepare for the upcoming Cannes Film Festival. It’s the producer’s responsibility to ensure foreign distribution rights are negotiated with even more scrutiny. Given this backdrop of uncertainties in the landscape of international film sales, this becomes critical. Needless to say, Hollywood studios are getting nervous. They want to tell everyone that, at least according to them, production spending has plummeted, with only $11.3 billion spent in the second quarter of 2024 — a jaw-dropping 20% decrease from the same period in 2022.
The proposal’s tentacles would reach much farther, though, with potentially serious ramifications for the global film industry. Vue Entertainment UK CEO Tim Richards commented on his concerns of the proposal. He’s heartfelt and passionate about wanting the return of American-made films. “We need to be making American movies again!” said him. This sentiment highlights the potential ripple effect that international markets and collaborations are now feeling due to the secondary impacts of Trump’s tariffs.
California Governor Gavin Newsom is more focused on addressing those persistent, long-term challenges in the film industry. To do that, he’s proposing to raise the state’s film and television tax subsidies to a staggering $750 million per year. This step is part of a broader effort to retain production in California. That development comes on the heels of other states like Georgia, Illinois and Kentucky increasing their efforts to lure a share of the burgeoning film production market.
While Trump’s proposed tariffs might encourage U.S. film companies to produce more films domestically, they may inadvertently lead to higher production costs abroad. Additionally, many filmmakers expressed concern that these tariffs would render certain projects financially unviable. This ultimately has a chilling effect on the total count of films being made.
Internationally, the proposal has created an outcry and alarm from foreign nations. Now Australian Home Affairs Minister Tony Burke is warning about the negative effects on his nation’s $3 billion film industry. Across the ocean, New Zealand Prime Minister Christopher Luxon expresses parallel concerns for his country’s film industry. Their reactions really highlight the global interconnectedness of cinema right now. They highlight the real prospect of retaliatory moves that would make it more difficult for American filmmakers to profit from doing business abroad.
In addition, many of the professionals in the construction industry have already rolled their eyes at Trump’s proposal. Whether this tariff initiative may be extended further remains an open question. Will it get momentum, or will it be repealed as some of his prior tariffs have been? The lack of clarity around the proposal leaves yet another layer of complication for filmmakers to contend with as they try to navigate an already tumultuous industry terrain.