US President Donald Trump said in a post on Truth Social on Monday that he plans to impose a 100% tariff on all films made outside the country, CNN quoted him as saying.
"Our film business is being stolen from the United States of America by other countries, just like "candy is being stolen from a baby". California, with its weak and incompetent governor, is being particularly hard hit," he wrote on his social media platform Truth Social on Monday.
"Therefore, to solve this long-standing, never-ending problem, I will be imposing a 100% tariff on all films made outside the United States. Thank you for your attention to this issue."
This is the first time a US president has threatened to impose tariffs on a service rather than a product. Trump made a similar statement in May, arguing that foreign productions pose a "threat to national security" and bring "messages and propaganda" into the US. According to him, the state of California has lost a significant share of the film industry due to tax incentives offered in countries such as the UK, Australia and New Zealand.
The US film industry was surprised by the statement in May. "At first glance, it is shocking and would mean almost a complete shutdown of production," a source told CNN, adding that it was unclear whether the president has the authority to impose such duties.
Meanwhile, California Governor Gavin Newsom has pushed for an expansion of the state's tax breaks to keep productions in Los Angeles. Newsom, a frequent critic of Trump, regularly responds to his social media posts with sarcastic comments.
American actors and directors typically prefer to work close to home. But "the fact is that it's cheaper for Hollywood studios to pay everyone to get on planes, to pay for hotels, because the cost of labor, the lack of discounts and the ability to do things overseas are infinitely cheaper," Jay Sures, vice president of United Talent Agency, told CNN in May.
Markets reacted quickly to the news, with Netflix (NFLX) shares down 1% on Monday morning, while AMC (AMC) and The Walt Disney Company (DIS) both rose slightly.
If the tariffs are implemented, it could also affect Bulgaria, where the film industry has been developing dynamically in recent years. Nu Boyana Film Studios in Sofia is a popular destination for Hollywood productions thanks to its lower costs and skilled crews. Imposing tariffs on films shot abroad would discourage American studios from shooting in Bulgaria, potentially leading to a loss of revenue and jobs for the Bulgarian film industry.
It is unclear whether and how the US would implement such a measure, but analysts say the tariffs would have significant consequences for the global film industry and for countries that rely on foreign productions as a source of investment.