Overview of Trump’s Controversial Proposal
On Monday, U.S. President Donald Trump reiterated his plan to impose a 100% tariff on all foreign-made films, as he often does through social media. Trump justified this measure by claiming that the U.S. film industry has been “stolen” from the country by other nations, and that Canada’s film industry is “dying quickly” due to incentives offered by other countries to attract filmmakers and studios. He labeled foreign cinema and their incentives as a “threat to national security” and “propaganda.”
Industry Figures React to the Proposed Tariffs
Scott Jones (Artist View Entertainment):
- At the Cannes Film Festival, Jones stated that he sees “no benefit” in the proposed measure and warned it could “harm” the industry, potentially leading to more job losses.
Wes Anderson (Director):
- At Cannes, Anderson questioned the logistics of applying tariffs to intellectual property, stating, “Can a film be held at customs? They aren’t shipped that way.”
Rob Lowe (Actor):
- Lowe commented that filming abroad is more cost-effective for studios, citing his show “The Floor” filmed in Ireland and suggesting that if “Parks and Recreation” were made today, it would be “100% shot” in Budapest due to cost savings.
Vivek Ranjan Agnihotri (Bollywood Star):
- Agnihotri expressed on social media that such a tariff could cause the collapse of India’s film industry, which is already in crisis.
Wall Street Analysts and Stock Market Reactions
Wall Street analysts have warned about the inflationary impact of tariffs in general. Regarding cinema, they predict that costs will be passed on to consumers, potentially leading to higher movie ticket prices.
Following Trump’s statements, several entertainment companies experienced stock value drops. Netflix, Disney, Warner Bros. Discovery, Paramount Global, and Comcast (parent company of Universal Pictures) saw their stock values fall in trading after the announcement, though some recovered later. This reaction reflects investor concern over potential increased production costs for global films and uncertainty in the business model.
However, some companies like Disney and AMC Theatres (a major U.S. cinema chain) saw slight increases.
Reactions in the Political Sphere
Howard Lutnick, Secretary of Commerce for the U.S., was authorized by Trump to begin implementing the tariffs. Meanwhile, California Governor Gavin Newsom expressed willingness to collaborate with the administration on a federal plan to support domestic production through tax incentives instead of punitive tariffs.
Concerns in Mexico
The primary concern, shared with the global film industry, is the lack of clarity on how tariffs would be applied and their potential harm to international collaboration:
On average, eight Mexican films reach U.S. theaters annually. In Mexico, speculation centers on whether the tariff would apply only to U.S.-studio productions filmed abroad or to any international film distributed in the U.S., including Mexican cinema.
Film distributor and screenwriter Fernando Montes de Oca previously warned that the measure could severely impact Mexico’s creative economy, as numerous U.S. film and TV projects are shot in Mexico, taking advantage of local costs and infrastructure. This could mean job losses, resources, and international collaborations.
In May when Trump first announced the plan, Mexico City Mayor Claudia Sheinbaum questioned the feasibility of the tariff and expressed doubts about implementing such a tariff in a “global, digital environment” like streaming.
Sheinbaum also announced support measures and a series of steps to strengthen and protect the national film industry, including tax incentives for Mexican film production. However, there is genuine concern in Mexico about the tariff’s impact on co-productions and the country’s film service industry, along with a call to action to safeguard and promote Mexican cinema against U.S. “cultural protectionism.”
International Support and Precedents
Other countries like Australia and New Zealand have also pledged to defend their film industries from Trump’s tariff. This proposal is part of a broader trade war that has already prompted China to announce a reduction in Hollywood film imports.
