Hollywood vs. the World: The New Tariff Frontier in Audiovisual Media
On May 5, 2025, an unexpected shift sent shockwaves through the global film industry. Donald Trump ordered the preparation of a 100% tariff on all films and series produced abroad and imported into the United States. While the move is officially framed as a measure to protect a weakened Hollywood, its implications go far beyond symbolism. It challenges already fragile economic balances and disrupts the global audiovisual value chain.
This 100% surcharge is a direct response to the tax incentives offered by numerous countries to attract international film productions.
The United Kingdom, for instance, drew £5.6 billion in production spending in 2024, with 86% stemming from Hollywood investments. By targeting these “offshore” productions, the U.S. administration aims to incentivize the reshoring of projects to American soil.
Notably, certain franchises may receive “cultural” exemptions, Trump himself hinted at such an exception for James Bond, citing his personal admiration for actor Sean Connery. This suggests the measure could be applied selectively, even diplomatically.
Beyond the political announcement, the technical and legal framework of this surcharge remains highly ambiguous. Which stage of production will be used to determine a film’s country of origin-shooting, post-production, or distribution?
More critically: how can a digital audiovisual work be taxed, especially when distributed via streaming platforms and protected under copyright law? Industry professionals warn of a potential conflict with WTO rules, which clearly distinguish between tangible goods and cultural services. Does an audiovisual work, delivered as a DCP or streamed online, fall within the traditional scope of customs duties?
This legal uncertainty is fueling growing concern within the industry. In the United Kingdom, audiovisual unions fear a large-scale pullout by American studios…
These studios have invested heavily in local infrastructure to take advantage of attractive tax regimes, including credits of up to 40%. The prospect of a double burden (local taxation combined with U.S. import tariffs) may prompt a strategic reassessment of their international operations. On the U.S. side, producers are raising questions about the practicality of such a measure: how can the origin of a film be determined when its production phases are spread across multiple continents? While awaiting further clarification, some projects have already been put on hold.
For international trade professionals, this situation introduces an entirely new layer of complexity. Should the surcharge be enforced, there would be an urgent need to develop tailored mechanisms: cultural or fiscal certificates of origin, evidence of filming locations, and specific classifications for digital works. These are challenges for which current tariff schedules are ill-equipped. Operators (freight forwarders, customs brokers, legal advisors) will need to adapt their practices and rapidly update their regulatory databases, often within tight timeframes.
Finally, this unilateral measure could trigger a chain reaction. Canada and Australia, both affected by the new rules, are already considering potential trade countermeasures. The European Union, while more cautious, is closely monitoring the situation, particularly with regard to co-productions that could be indirectly impacted. If the audiovisual sector becomes a new front in geopolitical tensions, coordinated responses may follow, potentially leading to a rebalancing of existing trade agreements.
