Newsom
Asks Trump to Work With Him on $7.5 Billion Tax Credit for Hollywood
The proposal
for a federal program came after the president called for tariffs on movies
filmed overseas, causing confusion and concern across the industry.
Few in the
film industry understood President Trump’s proposal to impose a 100 percent
tariff on movies produced outside the United States.
Shawn Hubler Matt Stevens Nicole Sperling
By Shawn
HublerMatt Stevens and Nicole Sperling
Reporting
from Los Angeles
https://www.nytimes.com/2025/05/05/movies/tariffs-trump-voight.html
May 5, 2025
A day after
President Trump stunned Hollywood by calling for steep tariffs on movies
“produced in Foreign Lands,” Gov. Gavin Newsom of California said on Monday
that he wanted to team up with the Trump administration to craft a $7.5 billion
federal film tax credit to aid the entertainment industry.
The
proposal, if approved, would represent by far the largest single government
subsidy program ever for the industry in the United States, and the first of
its kind at the federal level. More than three dozen states already give out
incentives to lure and retain film and television production, but there is no
national program, as is the case in some countries overseas. And there is no
single state program that gives out more than about $1 billion each year.
California currently allocates $330 million annually.
“America
continues to be a film powerhouse, and California is all in to bring more
production here,” Mr. Newsom, a Democrat, said in a statement late Monday
night. “Building on our successful state program, we’re eager to partner with
the Trump administration to further strengthen domestic production and Make
America Film Again.”
Mr. Newsom’s
proposal came in response to the president’s social media post on Sunday that
called for a 100 percent tariff on films produced outside the United States.
Over the weekend, Mr. Trump met at his Mar-a-Lago club in Florida with the
actor Jon Voight, whom he has named a “special ambassador” to Hollywood. After
that meeting he published his post, declaring: “WE WANT MOVIES MADE IN AMERICA,
AGAIN!”
The
president’s missive caused confusion in Hollywood, which has lost a great deal
of local film and television production to states and nations that offer rich
tax credits and cheaper labor. While few in the industry said that they
understood Mr. Trump’s proposal, some worried that tariffs would cause more
harm than good and called instead for federal help in the form of tax credits.
A tax credit
modeled after California’s incentive program is essentially what Mr. Newsom is
proposing, though the exact mechanics of how it would work or be enacted
remained uncertain. Earlier Monday, Senator Adam Schiff, Democrat of
California, said his office was working on a federal film incentive proposal.
The White
House did not immediately respond on Monday night to queries about Mr. Newsom’s
proposal.
Mr. Voight,
along with Steven Paul, his longtime manager, met with Mr. Trump and shared
their plans to increase domestic film production, according to a statement from
SP Media Group, Mr. Paul’s firm. They suggested federal tax incentives, changes
to the tax code, co-production treaties with other nations and infrastructure
subsidies, the statement said.
The proposal
also included “tariffs in certain limited circumstances,” the statement said,
adding that it was under review.
Mr. Voight
made the rounds in Hollywood last week, meeting with the Motion Picture
Association, Hollywood’s top lobbying group; various unions; and the lawmakers
in California who are pushing bills to increase state tax credits for the film
and television industries. State Senator Ben Allen, a Democrat whose district
includes Hollywood, met with the actor to discuss how to increase production in
the state, a representative said.
Mr. Voight
emerged from those meetings with two one-page documents drafted by the Motion
Picture Association. One letter encourages lawmakers in Washington to adopt a
manufacturing and production incentive to encourage more domestic employment.
The other asks Congress to extend a section of the tax code that expires at the
end of 2025 and allows certain film and television expenses to be deducted in
the year they are incurred.
There was no
mention of tariffs in drafts of the two documents, which were reviewed by The
New York Times.
The letters
were endorsed by Hollywood groups including the Producers Guild of America, the
Directors Guild of America, SAG-AFTRA, the Writers Guild East, Producers
United, the Independent Film and Television Alliance, and the International
Alliance of Theatrical Stage Employees.
The Motion
Picture Association declined to comment on Monday. The association’s members
include Disney, Netflix, Paramount, Sony, Universal, Warner Bros. and Amazon.
Much about
Mr. Trump’s tariff effort remains unclear. What kinds of movies, exactly, would
face tariffs? Would tariffs apply only to movies receiving tax incentives from
foreign countries — or to any movie with scenes shot overseas? What about
foreign films? Or postproduction visual effects work? Amid those and many other
questions, several analysts said it was highly unlikely that a 100 percent
tariff on all movies made overseas would materialize.
On Monday
morning a spokesman for the White House, Kush Desai, clarified that “no final
decisions on foreign film tariffs have been made” but added that “the
administration is exploring all options to deliver on President Trump’s
directive.” Mr. Trump told reporters on Monday that he planned to meet with
entertainment industry representatives, adding: “I’m not looking to hurt the
industry; I want to help the industry.”
The industry
has been desperate for help, just not necessarily this kind.
As generous
government incentives and cheaper labor have lured film and television studios
to shoot many projects far from Hollywood, Los Angeles has been left in a
lurch. Thousands of middle-class film workers — camera operators, set
decorators, lighting technicians, makeup artists, caterers, electricians — have
seen work evaporate.
In a
statement on Monday, the International Alliance of Theatrical Stage Employees
said tens of thousands of jobs across the United States had been lost in the
past two years.
“The United
States needs a balanced federal response to return film and television jobs,”
the union’s president, Matthew D. Loeb, said. The union praised Mr. Trump for
recognizing the threat that international competition poses to domestic film
industry jobs, but Mr. Loeb said that “we await further information on the
administration’s proposed tariff plan.” He added that the union said it would
not support a plan that would harm its Canadian members, or the industry
overall.
Duncan
Crabtree-Ireland, the head of SAG-AFTRA, the union that represents actors, said
in a statement, “We look forward to learning more about the specifics of the
plan announced by the president and to advancing a dialogue to achieve our
common goals.”
Industry
workers and state officials have sought to increase the amount of funding for
filming made available by the state of California, and some have also begun
pushing for a federal tax credit that can be layered on top of state
incentives, such as the one it appears Mr. Newsom has proposed. Mr. Newsom has
pushed to more than double the available funding for California’s tax incentive
program.
On Monday,
an array of state and federal lawmakers and the unions and moviemakers sought
to express appreciation for Mr. Trump’s attention to the issue while pushing
for tax credits rather than a tariff.
Mr. Loeb,
for instance, said his union had recommended that the Trump administration
introduce a federal film production tax incentive. Mr. Schiff agreed, and so
too, it seems, did Mr. Newsom.
“I share the
administration’s desire to bring movie making back to the United States,” Mr.
Schiff said in a statement. “While blanket tariffs on all films would have
unintended and potentially damaging impacts, we have an opportunity to work
together to pass a major federal film tax credit to re-shore American jobs in
the industry.”
Laurel
Rosenhall contributed reporting from Sacramento.
Shawn Hubler
is The Times’s Los Angeles bureau chief, reporting on the news, trends and
personalities of Southern California.
Matt Stevens
writes about arts and culture news for The Times.
Nicole
Sperling covers Hollywood and the streaming industry. She has been a reporter
for more than two decades.
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