<figure id="attachment_2963614" aria-describedby="caption-attachment-2963614" style="width: 1600px" class="wp-caption aligncenter"><img loading="lazy" class="wp-image-2963614 size-full" src="https://media.freemalaysiatoday.com/wp-content/uploads/2025/01/f36d21fc-donald-trump.webp" alt="Donald Trump" width="1600" height="1000" /><figcaption id="caption-attachment-2963614" class="wp-caption-text">US President Donald Trump told reporters that he would meet with entertainment industry officials first to make sure they liked the tariff idea. (AP pic)</figcaption></figure>
LOS ANGELES: The entertainment industry reacted with alarm and bafflement yesterday after President Donald Trump said he would impose a 100% tariff on all movies produced outside the US, but issued few details on just how such a levy would work.
Veteran studio executives who spoke with Reuters on condition of anonymity said the announcement on Sunday left unanswered the timing of the proposed levy and how it would be enforced for an industry whose biggest-budget films are often produced across several continents.
Trump&#8217;s pronouncement followed his meeting at Mar-a-Lago with his Hollywood ambassador, actor Jon Voight, special advisor Steven Paul and media executive Scott Karol.
&#8220;The group mulled a range of ideas to revive domestic film and TV production, including federal tax incentives, tax code changes and imposing tariffs &#8220;in certain limited circumstances,&#8221; the group said in a statement.
Slapping levies on an industry like film would mark a major extension of tariffs as a policy tool into services, for which the US runs a sizable trade surplus.
Like the auto, pharmaceutical and chip industries before it, Trump&#8217;s declaration threatens to put another business in a tariff-induced state of limbo.
The industry has been pressing for tax incentives to boost output in Los Angeles, the movie industry&#8217;s glitzy historic hub of cinema, as studios have shifted production to locations such as the UK, Canada and Australia to take advantage of generous tax credits and lower labor costs.
A survey among studio executives over their preferred production locations for 2025 to 2026 by ProdPro showed the top five choices were all elsewhere.
The White House&#8217;s trade policy is aimed at boosting US industrial activity, but the series of levies and rollbacks has sapped consumer and business confidence.
Tariffs on movies might prove particularly hard to implement.
One studio executive compared movie production to auto manufacturing, with various pieces &#8211; filming, visual effects and other elements &#8211; completed around the world, then assembled, through post-production, in the US Some executives wondered whether the levy would apply only to the work done elsewhere, or attach to projects jointly financed by foreign investors.
Producer Todd Garner said proposed tariffs could have the unintended consequence of stymieing creativity.
He cited director Steven Spielberg&#8217;s acclaimed World War II epic on the invasion of Normandy, France, &#8220;Saving Private Ryan&#8221;.
&#8220;How would you make &#8216;Saving Private Ryan&#8217; in the US? In Shreveport?&#8221; Garner said from Australia, where he is filming the action-drama &#8216;Runner&#8217;, &#8220;Or a globe-trotting &#8216;Mission: Impossible?'&#8221;.
Yesterday, Trump told reporters he would meet with industry officials first to make sure they liked the idea.
The White House said it had not made any final decisions, but noted that Hollywood film production had sharply declined from the previous year.
The primary union representing actors issued a supportive statement yesterday.
SAG-AFTRA National executive director and chief negotiator Duncan Crabtree-Ireland said the union supports efforts to increase domestic movie, television and streaming production and adding jobs for American workers.
&#8220;We look forward to learning more about the specifics of the plan announced by the president and to advancing a dialogue to achieve our common goals,&#8221; Crabtree-Ireland said.
The International Alliance of Theatrical Stage Employees, a union representing more than 170,000 technicians and craftspeople, called for a balanced federal response that includes tax incentives to help bring jobs back.
&#8220;Any trade policy &#8220;must do no harm to our Canadian members — nor the industry overall,&#8221; said International Alliance President Matthew D Loeb.
Implementation confusion
Shares of media companies slipped yesterday.
Streaming pioneer Netflix which relies on global operations to produce content for international audiences, posted a 2% decline in its stock.
Disney and Universal-owner Comcast edged lower.
Stocks of theater operators such as Cinemark and IMAX were down 1.6% and 2%, respectively.
IMAX declined to comment, while others did not respond to requests for comment.
Entertainment attorney Stephen Weizenecker said producers, financiers and film offices were trying to figure out how tariffs would be implemented, but said it could lead to a notable shift in production back to the US.
&#8220;If you get any sort of significant tariff, 10% or 20%, it takes away whatever production incentive there was for filming outside the US,&#8221; said Weizenecker, who advises producers and financiers on production incentives.
However, traditional enforcement tools, like customs inspections at ports of entry, will not work for movies that are licensed, streamed or distributed on global platforms using a borderless cloud infrastructure, wrote TD Cowen media analyst Doug Creutz.
The &#8220;risks to putting digital goods and services on the table in trade negotiations/wars are overwhelmingly tilted against the US,&#8221; he noted.
Hollywood brings in most of its box office revenue from overseas.
In 2024, about 70% of the roughly US$30 billion in global ticket sales came from outside the US and Canada, said Daniel Loria, senior vice-president at The Boxoffice Company.

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