In a surprise announcement that stunned the entertainment industry, former President Donald Trump has proposed a 100% tariff on all films produced outside the United States. The move, announced via Truth Social, is aimed at reversing what Trump calls the “death” of American filmmaking at the hands of foreign subsidies and incentives.
“The Movie Industry in America is DYING,” Trump wrote. “Other Countries are offering all sorts of incentives to draw our filmmakers and studios away… Therefore, I am authorizing the Department of Commerce, and the United States Trade Representative, to immediately begin the process of instituting a 100% Tariff on any and all Movies coming into our Country that are produced in Foreign Lands. WE WANT MOVIES MADE IN AMERICA, AGAIN!”
Commerce Secretary Howard Lutnick promptly responded on X (formerly Twitter): “We’re on it.”
But while the proposal plays to economic nationalism, experts say it’s not only impractical—it could do serious harm to Hollywood’s global dominance.
A Global Industry Built on Collaboration
The film industry today is far from isolated. It operates as a global network where financing, production, and post-production routinely span multiple continents. Major films are often backed by multinational investors, shot across several countries, and edited or scored in far-flung studios. In this world, defining a film as strictly “foreign” or “domestic” is nearly impossible.
Kathryn Arnold, a veteran entertainment consultant, put it bluntly:
“If you understand how complex and interconnected the global film market is—both in production and distribution—this proposal is devastating and doesn’t make any sense.”
And there’s a legal wrinkle. Films aren’t classified as “goods” under international trade agreements—they’re considered services. And in the realm of services, the U.S. isn’t lagging; it’s leading. According to the Motion Picture Association’s 2023 report, the United States consistently exports more film and television content than it imports. American media is one of the country’s few major cultural exports, showing a positive trade balance in virtually every global market.
U.S. Production Costs: The Real Problem
Trump is tapping into a real issue: high production costs have driven many American studios to shoot abroad. Countries like Canada, the U.K., Australia, and several European nations offer significant tax incentives to lure film productions, leading to a sharp decline in U.S.-based shoots. A 2023 study by ProdPro revealed that just half of film and TV budgets over $40 million were spent inside the U.S.
But most analysts agree that tariffs are not the solution. Instead of punishing foreign content, many industry insiders argue that the U.S. should provide stronger incentives for domestic filmmaking. States like Georgia have proven that tax credits can be a powerful lure, drawing blockbuster productions and generating thousands of jobs. Yet, no comparable federal program exists.
“A carrot would work better than a stick,” Arnold said. “Until the U.S. offers a competitive national incentive structure, we’ll keep bleeding productions to more cost-effective markets.”
Vagueness Breeds Uncertainty
Adding to the chaos is the vagueness of Trump’s plan. There’s no clarity on whether the tariff would apply to films that are only partially produced abroad or that use overseas post-production facilities. Consider a film shot mostly in California but with scenes in Vancouver—would it be penalized? Or what about a movie whose visual effects were created by a team in London? Would a film like Avatar, largely filmed in New Zealand but financed by an American studio, be considered foreign?
Streaming platforms add another layer of complexity. Would shows like The Crown or Squid Game, which are produced overseas but streamed in the U.S., fall under the tariff? Would co-productions—such as Netflix series made in partnership with American and foreign studios—also be taxed?
Without answers, the uncertainty alone could disrupt deals, delay releases, and scare off global collaborators.
Global Retaliation Could Backfire on Hollywood
If the tariff goes into effect, retaliation is almost guaranteed. And that’s where things get dangerous for the U.S. film industry.
“The retaliation will kill our industry,” warned William Reinsch, a senior adviser at the Center for Strategic and International Studies and former Commerce official. “We have a lot more to lose than to gain.”
American films dominate foreign markets. In 2023, U.S. movies accounted for over 70% of cinema admissions in Europe, according to the European Audiovisual Observatory. If other nations respond with tariffs or quotas of their own, they could shut Hollywood out of its most profitable markets—undermining an export sector worth tens of billions of dollars.
Already, the British entertainment union Bectu has called on the U.K. government to respond if Trump’s plan proceeds. “These tariffs, coming after COVID and the recent slowdown, could deal a knock-out blow to an industry that is only just recovering,” said Bectu head Philippa Childs.
A Misguided Fix for a Complex Industry
Trump’s love of tariffs is well-documented, but applying this tool to the creative industries shows a misunderstanding of how cultural exports work. Unlike steel or cars, taxing foreign films won’t boost U.S. production—it will likely limit consumer choice, invite retaliation, and damage a sector where the U.S. still holds a competitive edge.
As Henning Molfenter, former head of Germany’s Studio Babelsberg, observed:
“Hollywood is a flagship industry. It was naive to think it wouldn’t get caught in Trump’s broader trade war. But the real question is: How could this even work?”
The American film industry does face real challenges, from rising costs to fierce global competition. But a 100% tariff on foreign films is not a solution—it’s a provocation that risks harming the very industry it seeks to protect.
Instead of punishing international collaborators and viewers, policymakers should be crafting smart, targeted investments in domestic talent, infrastructure, and incentives. Global cinema isn’t the enemy. It’s part of the ecosystem that makes modern filmmaking possible.
In the end, it’s not just about making movies in America again—it’s about making smart policy that ensures American movies continue to thrive everywhere.
