Former President Donald Trump recently announced a radical plan to secure the future of the American film industry. He has promised to slap a mind-boggling 100% tariff on movies made overseas. This announcement caps a decade of rising competition from overseas locations that have become increasingly enticing to filmmakers. Toronto, the U.K., Vancouver, Central Europe, Australia – you name it, they’re all now the hottest movie production destinations. This tectonic shift has raised a host of challenges, implications, and lessons for Tinseltown to contend with.
In his opening declaration, Trump calls for appointing actors Mel Gibson, Jon Voight, and Sylvester Stallone “special ambassadors” to Hollywood. In his comments, he raised the alarm that foreign nations are poaching filmmakers from the U.S. with highly competitive incentives. According to Trump, other nations “are offering all sorts of incentives to draw” filmmakers and studios away from the U.S., posing a significant challenge to the domestic film industry.
According to data released by the Motion Picture Association (MPA), American films have long ruled international cinema. This year American movies have produced $22.6 billion in exports and enjoyed a $15.3 billion dollar trade surplus. Even with these successes, the MPA’s findings point to a shocking trend. Not a single American city made it into those top five chosen locations, as the Hollywood Reporter noted. The latest data underscore a growing concern. U.S. film and television production is already under siege by the lure of tempting tax incentives from other locales.
The competitive landscape has only gotten tougher. Cities all over the U.S—Atlanta, New York, Chicago, San Francisco—are currently leveraging aggressive tax incentives to lure incoming film and television productions. Combined, these initiatives have the potential to reinvigorate local economies and revitalize communities. Production levels have lagged behind with setbacks from the COVID-19 pandemic, the Hollywood guild strikes of 2023 and recent Los Angeles area wildfires.
Even as subsumed by the policy minutiae, Trump’s frustration with the state of the film industry has grown clear. He stated, “The Movie Industry in America is DYING a very fast death,” emphasizing his belief that urgent measures must be taken to counteract this trend. He’s long warned against the trend of movie producers moving productions overseas. He frames this transition as an economic concern and as a national security danger. Trump really fleshed out this view. He argued that there is a deliberate campaign by other countries to hoard this talent and that’s a national security danger. It is, besides all of that, messaging and propaganda!
In defense of the unique threat facing Hollywood, Trump has responded. He directed the Department of Commerce and the Office of the U.S. Trade Representative to levy tariffs on foreign films. He stated, “If they’re not willing to make a movie inside the United States we should have a tariff on movies that come in.” This much needed proposed action helps to safeguard American day-to-day movie makers. It’s keeping them competitive in a rapidly evolving global market.
The culture of film production, too, is undergoing a dramatic shift. Big-budget films like the upcoming “Mission: Impossible – The Final Reckoning” are now often shot across various international locations rather than solely within the United States. At the same time, China’s domestic movie production is on a tear. It’s cheered on landmark achievements such as the animated hit “Ne Zha 2,” which earned more than $2 billion.
Even as California’s Film & Television Tax Credit program is about to go even further on expansion. The proposal would increase the annual funding from $330 million to a whopping $750 million. This program is a tangible way that their initiative works to advocate for and equip local storytellers. It further promotes productions to keep spending within state lines.
