By Lisa French and Mark Poole
Trump tariffs: quick links
On 4 May, American President Donald Trump announced a 100% tariff on film and television produced ‘in foreign lands’. The announcement came only days before last week’s annual Screen Forever conference organised by Screen Producers Australia at the Gold Coast.
The threat of tariffs on the Australian screen sector was the talk of the conference as delegates and speakers alike expressed their confusion, uncertainty and incredulity.
Trump tariffs: Screen Forever Response
SPA CEO Matthew Deaner opened the conference by sharing that the organisation is currently collaborating with its international partners on a statement to reject the idea. Global collaboration on this is likely to be more effective than singular efforts, and it benefits screen industries globally to resist threats to cultural and creative exchange within the sector.
A key concern is the shattering of certainty within screen markets, where investors want to know that their investments are secure.
Whatever the final position adopted by the Trump administration on film tariffs, doubt has been sown, creating an industry-wide pause. From studio productions through to distribution agreements, industry players need to know what tariffs might mean for deals on the table, and how they might be achieved.
Questions abounded with Screen Forever delegates: what constitutes the definition of foreign? Is the Trump proposal legal? What does it mean for free trade agreements such as the one between Australia and the US which has impeded the imposition of content quotas? What about digital given the streamers are not mentioned in what appears to be a theatrical focus?
The threatened tariffs were widely received as impractical, and something that no one wants outside of the US. It was a key talking point in sessions where conference panels repeated the position that the ideal situation is a healthy international ecosystem, not one riven by uncertainty.
Trump tariffs: local and international industry response
Details of the proposed tariff are scant. The Australian Directors’ Guild last week described the move to its members as being a tariff aimed at US IP produced offshore, where US production companies shoot films and television outside of the US in order to take advantage of location subsidies offered in other countries, including Australia.
The Hollywood industry was severely impacted by COVID when most production was paused, and it has never recovered. Influential players like Jon Voight are lamenting the reduction in production and employment and seek to return Hollywood to its former strength.
The powerful trade unions in the US covering screen production are also lobbying Trump to curtail international productions that reduce the employment of their members.
Australia has been one of many international locations that have enticed big-budget productions away from Hollywood by offering a generous federal 30% location offset often topped up by state agencies with another 10-15%.
An example is the recent US film Anyone But You (2023) which was entirely shot in Sydney (although post-production was completed in Hollywood) and the NSW government provided millions of dollars in rebates to this film.
The crew were sourced from Australia, apart from the director Will Gluck and many of the cast, who were led by Americans Sydney Sweeney and Glen Powell.
Other major US productions filmed in Australia include Melbourne-made films starring Liam Neeson (Ice Road 2: Road to the Sky and Blacklight). A Trump tariff on ‘foreign’ productions could reduce the chance of such productions being produced in Australia.
The Guardian has reported that in the wake of local and global outcry, the White House has responded by ‘walking it back’, saying that ‘no final decisions on foreign film tariffs have been made’.
So, while it might be a policy thought bubble that doesn’t materialise, it warns of the screen ecosystem’s fragility, which can easily rupture. Whether the bubble bursts or not, it serves as a wake-up call to the industry’s potential vulnerabilities.
Trump tariffs: what is at stake?
It is not just job losses and reduced employment caused by the loss of productions made possible by generous Australian tax concessions. Sectors are integrated, so major players like Netflix and Disney have invested in screen businesses such as facilities and studios, and there is a risk to the sector if these were reduced or withdrawn.
In addition, the creative and cultural consequences could be significant. For example, heads of department, who currently stay in Australia because of the pipeline of work, might leave the country in the face of reduced production activity, diminishing our capacity. The funding and distribution pathways may be weakened, and the visibility of Australian filmmakers could be lessened.
For American filmmakers, they would find their creativity stifled as they might not be able to tell the stories they want to and be forced into a parochial path.
The sector is international, interconnected and production often takes place in multiple locations. Tariffs are likely to drive a more inward-looking and insular culture in America which has a lot to lose if the fountain of ideas and collaborators from global screen cultures were to be suddenly turned off.
Trump tariffs: possible actions
The Trump tariff proposal calls for timely and proactive strategies to be devised by state and federal screen agencies in order to manage any disruptions and build industry resilience.
If the threatened tariffs become a reality and they create barriers for international productions coming to Australia, the Australian government will need to strongly advocate for the sector diplomatically and otherwise.
To maintain a competitive edge, we’ll need to develop incentives and funding that counteracts such tariffs to support local talent and production capabilities. This includes the tax and investment environment for studios and production.
Strategies might include a pivot towards redirecting the location offset, currently used to encourage big budget productions to Australia, to more locally produced film and television, fostering stronger domestic storytelling and cultural representation.
This could be done alongside initiatives for supporting co-productions outside America and for co-productions to underpin stronger content production and partnerships with Asia, Europe and Canada.
Australia is high on the list globally of desirable destinations. The payoff of re-evaluating and diversifying partnerships would be to reduce reliance on the US market and the emergence of potentially new storytelling collaborations, for instance with the Asian-Pacific region.
State agencies might boost initiatives for post-production and digital sectors, which have significant expertise and an international reputation for quality.
The returned federal Labor government could also now consider how to ensure the more than a billion dollars the streaming services take from Australian consumers can go back into the industry, in particular to scripted content.
There was an attempt in 2022 to deliver content quotas for streaming services to ensure they produce a fair share of Australian content, but the Labor government’s attempts to deliver such quotas has failed, and now the environment is much more complex.
Trump also needs to be called out on the proposition that US owned IP does not benefit from offshore arrangements. Tariffs won’t support the cost of making films in the US, which is likely at the heart of the problem.
Trump tariffs: potential benefits
Whilst Trump’s tariffs represent a major disruption with significant negatives, it is also a potential opportunity to rethink Australian industry’s global engagement strategy to ensure a more resilient industry. This is where the industry will look to government for an agile response to help domestic producers.
An upside could be a unifying increase in nationalism that spurs on government and audiences alike to support Australian screen industries.
A member of a Canadian delegation to Screen Forever (Lisa Broadfoot, Canadian Media Producers Association) noted that their country had pulled together over Trump’s tariffs and his aim to make Canada a US state. Even Québec, in which there is often the call to separate from Canada, has rallied to the call for national unity.
According to Broadfoot, there are strong domestic tax incentives for in-country local Canadian production, and this is something Australian screen agencies could look to emulate. This might elevate authentic and original Australian storytelling, which delegates saw as the key to future success.
Lisa French is the Dean of RMIT’s School of Media and Communication. Mark Poole is a filmmaker and Victorian Chair of The Australian Directors’ Guild (ADG).
