Donald Trump has urged the United States Congress to introduce federal tax breaks for American movie studios, warning that the film industry in Hollywood is facing a deep crisis.
The US president described the situation in Hollywood as a complete and total disaster, saying that despite the famous reputation of the entertainment hub, there is virtually no production work left in the country.
Trump stated that he discussed the tax proposal during a meeting with actor John Voight. Trump had previously appointed the Academy Award winner as his special envoy for Hollywood affairs.
Meeting with special envoy
According to the president, Voight and several other industry representatives recommended establishing federal tax incentives to revive the domestic film business. Trump lamented that American movie productions have overwhelmingly relocated to Canada and other foreign countries, leaving domestic studios with little work.
Voight is an Oscar winner known for his roles in classic American films, including Coming Home and Midnight Cowboy, as well as his prominent public support for conservative political causes. Hollywood, located in Los Angeles, California, has historically served as the centerpiece of global film production, but production studios frequently seek cheaper filming locations abroad.
Economic impact and congressional plans
Trump emphasized that the massive outflow of studios abroad is causing serious economic damage to California and other US states. Foreign countries such as Canada have long offered production tax credits and lower labor costs, leading many major film and television projects to move their filming locations across the border.
California has struggled to retain film projects in recent years despite offering its own state-level tax credits. Canadian cities such as Vancouver and Toronto have established major production hubs backed by federal and provincial tax incentives, drawing a significant share of North American television and film shoots.
To address the economic damage, Trump announced plans to organize consultations with leaders of both political parties in Congress. He assured lawmakers that federal budget spending on tax incentives would pay for itself tenfold through job growth and increased federal budget revenues.
Tariff warnings and production costs
Congress, comprised of the Senate and the House of Representatives, holds exclusive federal legislative power to modify the tax code. Tax incentives in film production generally allow studios to write off expenses or receive tax credits based on local spending and payroll.
The president's new initiative follows previous reports regarding the impact of administration policies on the entertainment sector. In 2025, business news network CNBC reported that trade tariffs introduced by Trump against Canada would harm Hollywood by driving up overall movie production costs.
Journalists at CNBC warned at the time that tariff decisions would lead to higher budgets for studios. Experts added that American consumers would likely be forced to cut back on entertainment spending due to a broader rise in the cost of everyday goods and products.
