Context:

Donald Trump has proposed a 100% tariff on movies produced abroad to rejuvenate the American film industry, which many see as struggling due to international competition and high domestic production costs. Film industry experts argue that this tariff would be ineffective and difficult to implement, as modern filmmaking often involves international partnerships and resources. They suggest that rather than making foreign productions more expensive, efforts should focus on reducing production costs within the United States through measures like tax incentives. High labor costs and lack of federal rebates in the US make it more appealing for filmmakers to produce movies overseas. California Governor Gavin Newsom advocates for a $7.5 billion federal tax credit to counteract the negative impact of limited state tax credits and increased global competition on local production spending.

Dive Deeper:

• Donald Trump's proposed 100% tariff on foreign-produced movies aims to revive the American film industry, which has been hit by international competition and high production costs at home. However, experts criticize this approach, stating it would lead to fewer films being made due to increased expenses.

• The international nature of modern filmmaking, with many movies involving cross-border collaborations, complicates the definition of an 'American' movie and challenges the effectiveness of tariffs. Films like 'Mission: Impossible — Fallout' are co-produced by companies from multiple countries, highlighting the global interconnectedness of the industry.

• Marina Hyde and Jay Sures point out that high labor costs and the absence of universal healthcare and federal pensions in the US drive up wages, making it cheaper for filmmakers to operate abroad. This economic environment encourages 'runaway production' to countries offering more favorable financial conditions.

• California Governor Gavin Newsom and others argue for increased tax incentives to attract film production back to the US. Newsom's proposal for a $7.5 billion federal tax credit reflects a strategy to counteract the decline in local production spending caused by limited state tax credits and growing international competition.

• The decline in film production in Greater Los Angeles is attributed not only to 'runaway production' but also to slow recovery from past labor strikes and broader industry contractions. Industry professionals suggest that more effective solutions lie in making domestic production more financially viable rather than imposing restrictive tariffs.