Hollywood community deeply troubled by import taxes
Hollywood's Unease:
It's a confusing time in Tinsel Town as President Trump's bullish announcement of 100% tariffs on overseas films stirs up uncertainties and doubt. Hollywood insiders are scratching their heads, questioning the logic behind the proposed move.
According to legal eagle and industry expert, Jonathan Handel, "This doesn't exactly make sense." The bubbly lawyer elaborates, "Many of our big-ticket productions, from 007 to Mission Impossible, get shot abroad for creative reasons. If Tom Cruise needs to scale the Eiffel Tower, are we supposed to film it in Las Vegas's replica? That's just downright crazy!"
The topic of foreign film tariffs dominated Trump's Truth Social network on Sunday, with the president insisting on wanting "American-made movies." However, the move has set studio stocks tumbling, unions in a tizzy, and the entire industry debating its legality.
Handel points out the intellectual property aspect, "You can pay to watch a film, but you don't buy it like a piece of clothing or a car, subject to border taxes." He warns that "such tariffs would do more harm than good." The lawyer explains, "They'd reduce production, inflate costs, cut back on films for cinemas and streaming platforms, and ultimately harm distribution."
Sowing Doubt and Confusion
The presidential announcement has sent shockwaves through Hollywood, setting off emergency meetings, according to industry insiders speaking on condition of anonymity. A top distributor shares his skepticism, “I don't see any other objective than to sow confusion and divert attention."
"Let's hope this will only encourage U.S. states to ramp up tax incentives swiftly," he adds, acknowledging the ailing state of the American audiovisual industry.
A Troubled Landscape
The deteriorating health of the American audiovisual industry has been a topic of discussion for quite some time now. Since the historic strikes by actors and screenwriters that crippled the industry in 2023, Hollywood hasn't been able to bounce back.
In Los Angeles, film shoot days hit an all-time low in 2024, excluding the complete production shutdown due to the pandemic in 2020. The relocation of many productions to countries offering irresistible tax incentives, such as Thailand, Hungary, and South Africa, has further complicated the situation.
A Hollywood financier concurs with Trump's aim to boost domestic film production but disagrees with the tariff approach. "It's clear that tax incentives, not tariffs, are what we need," he asserts. "Tariffs would only suffocate what's left of the industry."
Waiting for a Balanced Response
As the uproar dies down, White House spokesmen assure that no decision has been made yet. Trump promises to meet with industry representatives soon, stating, "I'm not trying to harm the industry, I want to help it."
In the meantime, the unions are keeping a cautious tone, focusing on the importance of domestic film production. The union for actors, SAG-AFTRA, expresses support for increased film production in the U.S. and is eager to learn more about the future moves.
The union representing behind-the-scenes Hollywood workers, IATSE, recommends a federal tax credit for film production, stressing that any policy should avoid harming the industry as a whole.
- The Hollywood insider, Jonathan Handel, questioned the logic of the proposed tariffs on overseas films, stating, "This doesn't exactly make sense."
- A top Hollywood distributor expressed skepticism about the tariff announcement, suggesting, "I don't see any other objective than to sow confusion and divert attention."
- Despite Trump's announcement of 100% tariffs on foreign films, a Hollywood financier advocated for tax incentives over tariffs, asserting, "It's clear that tax incentives, not tariffs, are what we need."
- The union for behind-the-scenes Hollywood workers, IATSE, recommended a federal tax credit for film production, emphasizing, "Any policy should avoid harming the industry as a whole."
