Effect on Canadian industry could be widespread after Trump threatens tariffs on films
The latest salvo in U.S. President Donald Trump’s trade war is a threat to slap 100 per cent tariffs on foreign films.
In a post to Truth Social Sunday night, Trump wrote: “I am authorizing the Department of Commerce, and the United States Trade Representative, to immediately begin the process of instituting a 100% Tariff on any and all Movies coming into our Country that are produced in Foreign Lands.” He added: “WE WANT MOVIES MADE IN AMERICA, AGAIN!”
Trump’s reason for the move was that the U.S. film industry is dying “a very fast death,” and that other countries “ are offering all sorts of incentives to draw our filmmakers and studios away from the United States.”
The Movie Industry in America is DYING a very fast death. Other Countries are offering all sorts of incentives to draw our filmmakers and studios away from the United States. Hollywood, and many other areas within the U.S.A., are being devastated. This is a concerted effort by…
— Donald J. Trump Posts From His Truth Social (@TrumpDailyPosts) May 4, 2025
Both points are, broadly speaking, true. Filming in Los Angeles dropped 22.4 per cent in the first quarter of the year, NBC reported . It added that there are economic knock-on effects that include restaurants, retail and support services.
Meanwhile, tax incentives are part of the business of filmmaking around the world. For instance, the Film or Video Production Services Tax Credit from the government of Canada provides eligible companies with a tax credit of 16 per cent of qualified Canadian labour expenditures. There are similar credits for both domestic and foreign productions at the provincial level as well.
America has its own tax credits. Last year, California Governor Gavin Newsom more than doubled his state’s film and TV tax credit program to $750 million from $330 million. But there is no national tax credit.
Charlie Keil , a professor of film and history at the University of Toronto, told National Post that Trump’s announcement was “very short on details” and that it was difficult to know how such a tariff would even work.
The simplest example would be a Canadian, French or Chinese film that was looking for distribution in America. “Those you could see easily … the hundred per cent tariff being applicable,” he said.
“But what about films that … 80 per cent of them are made in the U.S., and then some of the location shooting is done in another country? Or what about all the production is done in the U.S. but then some of the post-production is done in another country? Are those also going to be subject to 100 per cent?”
That was echoed by Noah Segal, co-president of Canadian production and distribution company Elevation Pictures. He noted that Dune 2 was an American studio production with a Canadian auteur (Denis Villeneuve) at the helm, and worldwide shoots including Hungary, Jordan and Italy.
“The game has always been ownership of (intellectual property),” Segal said. “So I’m not sure what he (Trump) is afraid of. If the Americans own the majority of content, they win, no matter if it’s shot in Germany, Latvia or the moon. It doesn’t matter.”
That said, Canada has a robust post-production and co-production industry that needs to be protected. But that can be through domestic productions as well as foreign ones.
“If (Trump) pulls GM and Ford out of Canada, you’re not going to create a Canadian car business,” Segal said. “Whereas in the feature film business, you can create feature films in Canada. You can create co-productions with other territories.”
U.S. productions come to Canada because of great locations, a cheaper dollar and well trained local talent, he said, none of which tariffs will impact in the short term. Bringing production back to America means “less will be made and prices will be higher; therefore you’ll have to charge consumers more. Once again, tariffs will affect the consumer more than anybody.”
Keil noted that other countries have tried to push back against an influx of American films with tariffs and other methods. China famously has an annual quota on how many U.S. films that can be screened there, which it recently reduced in response to U.S. tariffs in other sectors.
“There’s been a whole arsenal deployed against a behemoth,” he said of other countries’ efforts. “This is the behemoth turning around and saying we want more for what is still for them a fairly lucrative industry to be taking place on domestic land.”
The effect on the Canadian film industry could be widespread, he suggested.
“Our industry is very much a supplemental service industry. We are kept afloat by the fact that we are the service industry of choice for many American-made entertainment products.” He added that Australia, the U.K. and much of eastern Europe are in a similar position. “All of those industries would be damaged by this.”
Justin Rebelo, CEO of Canadian studio Vortex Media, said the threat of tariffs highlights the need for Canadians to invest in the domestic industry. He noted that the Canadian Radio-television and Telecommunications Commission is holding hearings this month and next on regulations for Bill C-11, the Online Streaming Act , which became law in 2023. It amends the Broadcasting Act to include digital platforms, and gives the CRTC new powers with a goal of promoting Canadian cultural expression.
“I think it’s really important for Canadians to continue to have … the right to own their own (intellectual property) and their own content, and I think it’s really important that all platforms that are existing here in Canada have an obligation and a requirement to invest in Canadian content. This only continues to escalate and highlight that importance.”
On Trump’s specific announcement, he said: “For now I think it’s just very vague. I’m not sure what else to say except that the devil will be in the details.”
A similar tone was taken by Reynolds Mastin, President and CEO of the Canadian Media Producers Association .
“While specific details are far from clear at this point, the proposed actions outlined in U.S. President Donald Trump’s announcement will cause significant disruption and economic hardship to the media production sectors on both sides of the Canada-U.S. border,” he said in a statement to National Post.
“Yesterday’s announcement, and the uncertainty it has caused, underscore the incredible importance of ensuring that Canada has a strong, independent domestic media industry. We look forward to making this case at the upcoming CRTC C-11 hearings.”
Segal suggested that a federal-level tax credit in the U.S. could help move more production back home, more efficiently than a tariff.
“I understand that (Trump) is noticing there’s a problem, so good on him. But bad on him for trying to take a complicated problem and oversimplify it. At first blush, that approach won’t work for anybody.”
Taking the example of Deadpool & Wolverine, which was shot in Canada, he said that if tariffs go into effect: “Disney will still make Deadpool. It’ll just cost 25 to 30 per cent more.”
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