Hollywood is on edge as U.S. President Donald Trump’s proposed tariffs on foreign films spark fears of international retaliation that could undermine one of America’s most influential industries.
In a post on Truth Social, Trump announced plans to institute tariffs on foreign movies, claiming it would protect U.S. interests. “We want movies made in America, again!” he wrote. However, analysts warn that this move could backfire by exposing vulnerabilities in the U.S. services trade and inviting countermeasures from other countries.
Shares in major U.S. media and entertainment companies fell on the news, with Netflix Inc. and Warner Bros. Discovery, Inc. dropping about three percent, and Paramount Global and Walt Disney Co. sliding about two percent.
‘Retaliation Will Harm U.S. Film Industry’
Experts believe that imposing tariffs on foreign films could lead to significant retaliation from other nations. Cui Fan, a professor at the University of International Business and Economics, stated that countries like those in the European Union, Canada, and Japan might introduce policies favoring local films or limit the import of American movies.
“They might impose additional taxes or fees on screenings of American movies, which would directly impact Hollywood’s global box office performance,” Cui told China Media Group (CMG).
Scott Roxborough, European Bureau Chief at The Hollywood Reporter, warned that the tariff plan could have a catastrophic impact on the industry. “The whole movie industry is already in crisis. Adding these tariffs could have a disastrous effect,” he said. “If Europe decides to impose tit-for-tat tariffs, the impact could be huge.”
William Reinsch, a former senior official at the U.S. Department of Commerce, echoed these concerns. “The retaliation will harm our industry. We have a lot more to lose than to gain,” he told The Guardian.
California’s Economy at Risk
The entertainment industry is a cornerstone of California’s economy, creating over 600,000 jobs and generating $30 billion in annual economic output. The state has voiced strong opposition to the proposed tariffs, which could drive up production costs and affect employment.
According to a recent report by the California Film Commission, Los Angeles-area on-location film production dropped 22.4 percent year-on-year in the first quarter of 2025. Industry insiders fear that imposing 100 percent tariffs on foreign films could push more productions to streaming platforms, intensifying competition for traditional Hollywood studios.
Pang Hongbo, a film critic, told CMG that such tariffs would likely force many low-to-mid-budget foreign art films to abandon U.S. theatrical releases. “This could impose major barriers for Oscar-qualifying films requiring U.S. theatrical screenings, potentially eroding the Academy Awards’ global influence,” he said.
‘Shooting Itself in the Foot’
Taxing foreign films could also draw the U.S. services trade sector into a trade war. The U.S. holds a significant trade surplus in services, with exports exceeding $1 trillion in 2023 and supporting 4.1 million high-paying jobs.
Li Jun, director of the Services Trade Institute under the Chinese Academy of International Trade and Economic Cooperation, commented that the tariff plan is like “shooting itself in the foot,” as it undermines the global reputation and long-term interests of the U.S. services sector.
As tensions rise, many in Hollywood and beyond are urging the Trump administration to reconsider the proposed tariffs to avoid a potential crisis in the global film industry.
