In brief
In recent statements, Donald Trump has renewed his threat to impose a 100% tariff on non-US made movies, claiming the American film industry has been undermined by foreign competition. The announcement follows mounting concerns about the details and feasibility of such tariffs as prominent filmmakers have increasingly opted to shoot films in countries offering better financial incentives. Analysts express skepticism regarding how these tariffs would function and their potential impact on production costs and viewer demand.
Donald Trump has repeated his threat to impose a 100% tariff on all films not made in the US, claiming the American industry had been stolen by other countries.
He said on Monday that California had been heavily affected and the levy would solve this long time, never ending problem.
In May, the US president indicated he would discuss this plan with Hollywood executives and start the process of implementing the levy, arguing that America's film industry was dying a very fast death.
Trump's remarks coincide with his announcement of a new wave of tariffs last week, including a 100% levy on branded or patented drug imports.
On his Truth Social platform, Trump stated: Our movie making business has been stolen from the United States of America, by other countries, just like stealing 'candy from a baby.' He particularly singled out California for its economic struggles, attributing the issues to what he termed a weak and incompetent Governor.
The specifics of when the tariff would take effect remain unclear, as does whether it would cover films streamed online, such as those on Netflix, or only theatrical releases. Dan Coatsworth, an investment analyst, noted that many filmmakers are choosing to produce outside the US for greater incentives, posing questions about how a tariff could be effectively applied.
According to Coatsworth, defining what constitutes an American-made movie would be problematic, especially for films shot in the US but featuring foreign talent. The implications could also lead to increased production costs, which might be passed onto consumers, ultimately harming demand for streaming services and cinema operators.
While stocks for large entertainment companies briefly dropped following Trump’s comments, they have since rebounded, indicating investors may not perceive the tariff threat as urgent.
Several recent major films produced by US studios were shot outside of America, including Deadpool & Wolverine, Wicked, and Gladiator II. Despite these challenges, the US still stands as a key global production hub, with recent reports indicating a $14.54 billion production spending, although this figure has decreased by 26% since 2022, as more filmmakers gravitate towards countries like Australia, New Zealand, Canada, and the UK.
