President Donald Trump’s idea to place tariffs on movies produced overseas has reportedly shaken studios.
As The Wall Street Journal (WSJ) reported Monday (May 5), the president’s planned 100% tariffs on such productions drove down share prices for companies like Disney and Netflix, even though it’s not clear how the White House would implement such a policy. And hours after Trump’s proposal, the administration appeared to walk it back.
The report notes that while many in Hollywood would like to see ways to make producing films in the U.S. more economical, the tariffs could bring uncertainty to a business fighting for relevance against digital challengers.
“If this is deployed on a wide scale, it may end up harming the very industry it is supposed to help,” Barclays analysts wrote in a research note, per the WSJ.
As the WSJ points out, Hollywood studios often make films in countries like Canada to take advantage of foreign tax incentives and lower personnel costs. This year’s highest-grossing production, “A Minecraft Movie,” was shot in New Zealand.
“The Movie Industry in America is DYING a very fast death,” Trump wrote on Truth Social Sunday (May 4), calling international filmmaking incentives “a concerted effort by other Nations and, therefore, a National Security threat. It is, in addition to everything else, messaging and propaganda!”
However, by Monday, a White House spokesperson said no final decision on the plan had been made, while Trump himself told reporters he wanted to meet with studio executives to get their feelings on the tariffs.
In other tariff-related news, PYMNTS on Monday examined the effect the levies are having on service related businesses.
American goods companies are widely seen as the most threatened by the tariffs, as it’s their imports of products from China facing massive price increases.
“But services firms are also highly exposed. While they don’t face a direct threat, because they tend not to import physical goods from abroad, they’re squarely in the crosshairs because their bread and butter is working for goods companies,” PYMNTS wrote, in advance of the forthcoming PYMNTS Intelligence report “Tariffs and Business Uncertainty: The Current State of Play, May 2025.”
“The mechanism is indirect, but the result is the same: Any downturn in business for goods companies quickly translates into a downshift for the services companies working for them.”
