President Trump said he would impose 100% tariffs on films “made” outside the United States and announced in a social media post on Sunday that the issue posed a national security threat.
Mr. Trump said he had authorized U.S. Trade Representative Jamieson Greer to start taxing “any movie made abroad and all movies in all movies.” “This is a concerted effort by other countries and therefore a national security threat,” Mr Trump added.
The Film Association represents Washington's largest Hollywood studio, declining comments. The association’s latest economic impact report is based primarily on government data and released in 2023, which shows that the film industry has produced a positive U.S. trade balance in every major market in the world.
This is often the case with Trump's declaration on social media, and it's unclear what he is talking about. Does he mean any movie, including independent foreign language films dedicated to art gallery cinemas and films specializing in streaming services?
Such tariffs only apply to movies that receive tax incentives from abroad, or any movies that are filmed overseas? What about the visual effects that are produced later? A superhero movie may often involve six or more professional companies scattered around the world.
Technically, the vast majority of movies displayed in American cinemas are made in the United States – scripting, pre-processing production plans, main actors, editing and adding shots. But Hollywood is increasingly turning to foreign regions during the movement of camera rolling parts, because like so many traditional manufacturing industries, it is much cheaper.
Tax incentives are provided by the UK, Hungary, Australia, New Zealand, Canada and other countries, and tax incentives are used by Disney, Warner Bros., Universal Pictures and other major studios including Netflix and Amazon. International regions also often bring lower labor costs.
As a result, thousands of middle-class film workers in the United States – camera operators, decorators, lighting technicians, makeup artists, catering waiters, electricians – have evaporated their jobs. According to the International Alliance of Drama Stage Staff, about 18,000 full-time jobs have been cancelled in the past three years, mainly in California.
“We allow California to be Detroit’s entertainment industry for the automotive industry,” Alliance Vice President Michael F. Miller Jr. told The Times last month.
Sometimes the cost of transporting props and people overseas end up making the studio more costly than they would expect to lose through the tax credit. But more, the cost of working in California is too difficult, the producers say. Budgets are budgets, and these budgets are getting tighter. The peak stream has ended, fewer people go to cinemas, and studios no longer get dollars from DVD sales.
Gov. Gavin Newsom has pushed more than double the available funds for the state's tax incentive program. California lawmakers have also proposed bills that would increase their movie tax credits under pressure from voters and several alliances formed after recent wildfires in Los Angeles and surrounding areas.
Trump said in a January social media post shortly before the inauguration that he appointed Mel Gibson, Sylvester Stallone and Jon Voight as “special ambassadors” with the goal of “to lose a lot of Hollywood in the past four years, and back abroad over the past four years, bigger, better, and stronger than ever!”
The cast are passionate supporters of the president and have not done anything publicly, although Angelina Jolie's father, Mr. Voight, met with several union and studio executives on a private fact-based tour.
Matt Stevens Contribution report.
