Trump's Proposed 100% Tariff on Foreign Films Alarms Global Industry, Threatens U.S.-India and Japan Trade Relations

Former U.S. President Donald Trump's proposal to impose a 100% tariff on all foreign-produced films has raised concerns in the global film industry. The policy aims to boost domestic film production but has alarmed India's film sector, which relies heavily on U.S. revenue. The tariff could disrupt U.S.-India film distribution and affect digital deals. The UK and European film sectors are also unsettled, with production plans on hold. Japan, amid trade talks with the U.S., opposes the tariffs. Hollywood questions the policy's scope, fearing unintended impacts on U.S. films shot abroad.

India’s Film Industry Faces Revenue and Employment Risks

India’s film industry, one of the largest in the world by output, is particularly vulnerable to the proposed tariff. According to a report by Deloitte and the Motion Picture Association, Indian cinema earned approximately ₹20 billion ($237 million) from overseas box office in fiscal 2024, with around 40% of that revenue coming from the United States. The U.S. market is especially important due to its sizable Indian diaspora, estimated at 5.2 million people.

Shibashish Sarkar, president of the Producers Guild of India, noted that Indian films gross around $100 million annually at the U.S. box office. A 100% tariff could double the cost of distribution, forcing exhibitors to raise ticket prices or pass the burden onto producers. “Either way, there will be an impact on the Indian producer’s share from a theatrical point of view,” Sarkar told Variety.

The Indian Motion Pictures Producers’ Association (IMPPA), representing 25,000 producers and distributors, warned of mutual damage. President Abhay Sinha emphasized that U.S. exhibition chains also rely on Indian content, and the tariff could disrupt this symbiotic relationship.

Beyond theatrical releases, the tariff could affect digital and pay-TV deals. “Any revenue generated by Indian content in the U.S. would likely be subject to the tariff,” Sarkar added, potentially reducing the appeal of Indian films to U.S. distributors and platforms like Netflix and Amazon Prime.

The impact could also extend to Hollywood productions that outsource post-production and visual effects work to India. “If the tariff covers post-production services, the consequences will be bigger,” said Madhu Bhojwani, co-founder of Emmay Entertainment. India has become a cost-effective hub for such services, and a decline in outsourced work could affect employment in the media services sector, which currently supports over 270,000 jobs.

UK and European Film Sectors Also on Edge

The United Kingdom’s film industry, heavily reliant on U.S. distribution, is similarly unsettled. Trump’s threat to impose a 100% tariff on all films “produced in Foreign Lands” has led to a freeze in new production plans, according to The Guardian. The uncertainty surrounding the policy has made investors wary, with many projects now on hold until further clarity emerges.

The UK benefits from generous tax incentives—up to 53% for low-budget films—which have attracted major U.S. streamers like Netflix and Disney. However, the British film sector is largely foreign-owned, with 42% of turnover in the creative industries held by non-UK firms as of 2024. This structure means that while the UK provides locations and skilled labor, much of the revenue flows back to the U.S. or tax havens.

A report by the Economics Observatory highlighted that UK production companies saw a £392 million drop in revenue in 2023, with exports contracting by 1.9%. The proposed tariffs could exacerbate this decline, especially for high-end TV and film productions that rely on U.S. distribution.

Japan Pushes Back in Trade Talks

While the film industry is not the central focus of Japan-U.S. trade negotiations, the broader context of Trump-era tariffs remains a sticking point. Japan’s government has been pressing for the removal of high tariffs on key exports such as automobiles, steel, and aluminum—sectors that support a significant portion of the Japanese workforce.

In recent talks in Washington, Japan’s chief negotiator Ryosei Akazawa described the U.S. stance on maintaining tariffs as “extremely regrettable.” Japanese officials have called for the retraction of all higher tariffs, including a 14% additional levy on top of a 10% base tariff. Finance Minister Katsunobu Kato emphasized that Japan would continue to demand the removal of tariffs on autos and industrial materials, which account for about 30% of Japan’s exports to the U.S.

The Japanese government has also hinted at using its large holdings of U.S. Treasury securities as leverage in future negotiations. Both sides aim to reach a deal by June, with a potential meeting between Prime Minister Shigeru Ishiba and President Trump on the sidelines of the G7 summit.

Hollywood Caught in the Crossfire

Trump’s announcement, made via his Truth Social platform, claimed that the U.S. film industry was “dying” and needed protection from foreign competition. He authorized the Department of Commerce and the U.S. Trade Representative to begin implementing the 100% tariff on all films produced outside the country.

However, the policy has been met with confusion and skepticism within Hollywood. Industry insiders question how “foreign-produced” will be defined, especially given the globalized nature of modern film production. Many U.S. films are shot abroad to take advantage of tax incentives and lower production costs, raising concerns that even American-made films could be affected if they include foreign elements.

Paul Erickson, a media analyst at Omdia, noted that the potential benefits of the tariff are difficult to gauge due to the lack of details. “The level of potential benefit to the U.S. domestic film ecosystem is difficult to assess,” he said.

California politicians and industry leaders have instead advocated for federal tax credits as a more effective way to bring production back to the U.S. Representative Adam Schiff stated that while he supports reshoring film jobs, “blanket tariffs on all films would have unintended and potentially damaging impacts.”

Global Industry Awaits Clarity

As of May 7, 2025, Trump has not provided a timeline or detailed framework for the implementation of the proposed tariffs. He has stated that he will consult with Hollywood studios before making a final decision, but no schedule for such consultations has been announced.

In the meantime, film industries around the world are bracing for impact. Indian producers are calling for urgent dialogue between New Delhi and Washington to mitigate risks, while Japanese officials continue to push for a comprehensive rollback of Trump-era tariffs. The uncertainty has already begun to affect investment decisions, production planning, and international collaboration in the global film ecosystem.

Trump's Proposed 100% Tariff on Foreign Films Alarms Global Industry, Threatens U.S.-India and Japan Trade Relations

Key Updates

Trump Proposes 100% Tariffs on Foreign Films, UK Productions at Risk; White House Clarifies No Final Decision