Trump imposes 100% tariff on films made outside the US

On September 29, President Donald Trump announced in a post on the Truth Social platform that he intends to impose a 100 percent tariff on “any films produced outside the United States,” reports CNN.

Trump did not specify when or how this tariff might be introduced.

If the 47th president carries out his plan, it will be the first time he has actually imposed a tariff on a service rather than a product.

Initially, the White House chief threatened in May to impose a 100% tariff on foreign films, arguing that other countries offer tax breaks that attract filmmakers. In his September 29th post, he singled out California, declaring that it "has been hit particularly hard!"

On the subject: Trump Tariffs Could Push Nearly a Million Americans into Poverty

Hollywood was completely unprepared for such an initiative when Trump first announced the tariff in May.

"On the surface, it would be shocking and would practically shut down production," an industry insider told CNN at the time. "But in reality, he has no jurisdiction to take such a step, and it would be impossible to implement effectively."

American actors and directors typically prefer to work close to home. However, "it's cheaper for Hollywood studios to cover flights and hotels for all their employees because labor costs, the lack of tax breaks, and the ability to film abroad are significantly cheaper," explained Jay Sures, vice chairman of United Talent Agency, in May.

Netflix (NFLX) shares opened down 1% on Monday morning following Trump's tweet, while other film-related stocks, including AMC (AMC) and The Walt Disney Company (DIS), opened higher.

Cinema sales in the US are declining as the number of major releases has dwindled following the pandemic and audiences have turned to streaming platforms for home viewing.

Total US box office revenue peaked at just under $12 billion in 2018, before falling to just over $2 billion in 2020, when many theaters were closed due to the COVID-19 pandemic. Despite the reopening of theaters, the number of releases is now roughly half of 2019 levels. Total domestic box office revenue has not exceeded $9 billion since then.

Warner Bros. Discovery, CNN's parent company, has now grossed $4 billion in worldwide box office revenue this year, becoming the first studio to reach that level.

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In addition to film tariffs, Trump is preparing a whole range of other fees and taxes.

The administration currently plans to impose a 100 percent duty on branded medications (with some exceptions); a 25 percent duty on heavy trucks; a 50 percent duty on kitchen cabinets and nightstands; and a 30 percent duty on upholstered furniture.

In a separate social media post on September 29, Trump said he planned to impose a "significant" tariff on all furniture imported into the United States.

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