(Inc.)—Hollywood movies aren’t necessarily made in Hollywood—and President Donald Trump wants to change that. On May 4, he announced a 100 percent tariff on films that are produced overseas.
For years, companies have filmed in the United Kingdom, Canada, New Zealand, and other countries for both aesthetic reasons and to save on production costs. The incentives, such as tax breaks, that other countries offer to American filmmakers create a national security threat and open the door to foreign propaganda, he claimed in a post on Truth Social. Even the Captain America franchise—the latest installment of which was filmed in Atlanta, Washington, D.C., Mexico, Japan, and Jordan—may not be spared.
At press time, there was no executive order outlining the details, including how films that were partially filmed or produced in the U.S. would be taxed, how the tariffs would be calculated, and whether the tariffs apply to movies shown on streaming services such as Netflix. Commerce secretary Howard Lutnick simply said on X, “We’re on it.”
The surprise announcement is just the latest in a series of unpredictable moves by the White House that have left companies large and small scrambling to adapt to new import taxes amid an ever-changing landscape. And they’re doing so with minimal details about implementation.
In March, Apple reportedly began airlifting 600 tons of iPhones—about 1.5 million units—out of India and into the U.S. The airlift was in response to the anticipated 27 percent tariffs on goods from India, announced as part of Trump’s sweeping “Liberation Day” economic plan, scheduled to go into effect on April 9.
The phones were barely off the planes before the president redialed, saying that for 90 days most nations would be subject to a 10 percent tariff. China, however, where Apple produces most of its iPhones, would be subject to tariffs that rocketed up to 145 percent, on top of any existing tariffs.
Then the president pulled back once again with an April 11 executive order suspending new tariffs on most goods made with semiconductors, such as laptops and smart phones, at least temporarily, reportedly after CEO Tim Cook spoke directly with him. Despite the reprieve, Cook said in a May 1 earnings call that the company expected to take a $900 million hit in the second quarter of 2025 tied to tariff turbulence.
Masaru Torito, whose family owns two Denver-area Japanese restaurants, told Inc. in March that not knowing how much things will cost—from avocados from Mexico to takeout packaging from China—has made it impossible to budget. “This uncertainty really makes it hard for us to do business in a sustainable way,” he said. “A little clarity would be appreciated.”
On the campaign trail, Trump called “tariff” the most beautiful word in the dictionary. Tariffs, as everyone knows by now, are taxes paid by the importer—and ultimately consumers, depending on how much of the tax is passed through. And even those analysts who support some level of protectionism to fight back against unfair practices by other countries question the utility of Trump’s sweeping tariffs.
On the first day of his second term, Trump announced an “America First” trade policy. In quick succession, he unleashed administrative actions against China, Canada, and Mexico (America’s largest trading partners), as well as tariffs on steel and aluminum. On April 2, so-called “Liberation Day,” he announced sweeping tariffs on all of America’s trading partners, at rates that shocked many observers.
But just as fast as new tariff policies were put into place, many were put on hold for 90 days or repealed. The reasons for the back-and-forth varied, from giving other countries time to negotiate trade deals to giving industries time to adapt to the realization that government officials didn’t have proper procedures in place to immediately collect the new duties.
Some business owners have rushed to research new supply chains or stash stockpiled goods in bonded warehouses. Others are pulling back spending until the full effects of the tariffs come clear.
“Ninety-nine percent of businesses in the U.S. are small businesses, and they’re really unable to adapt to these changes like a larger corporation would be,” says Alexis D’Amato of Small Business Majority, a Washington, D.C.-based advocacy group representing more than 85,000 small businesses.
Many of the businesses in the network are stockpiling goods, renegotiating contracts with vendors, pulling product lines, or raising their prices. “None of these things are really good for the economy, especially when inflation is still going up,” says D’Amato.
As of May 5, most global goods were subject to a blanket tariff of 10 percent. Goods from China, however, are subject to 145 percent tariffs. Those tariffs are subject to stacking, meaning they’re on top of any existing tariffs. Certain goods from China are now subject to 245 percent tariffs. Goods from Mexico and Canada are taxed at 25 percent—unless they qualify for duty-free status under the U.S.-Mexico-Canada Agreement.
But there’s more: Imported cars and some auto parts are currently subject to a 25 percent tariff, although car makers recently got a small break when Trump exempted those imports from tariff stacking. But tariffs are in place on imported aluminum and steel—critical to automaking and construction—and could be coming for copper, lumber, pharmaceutical products, semiconductors, and seafood imports.
Starting in October, containers arriving on ships that were built in China—regardless of ownership or where the goods onboard were made—will be subject to additional fees when they’re unloaded at U.S. ports.
On May 2, what’s known as the de minimis exemption—a century-old rule that allows packages worth less than $800 to enter the U.S. duty free—was eliminated for packages from China. Instead, those packages will be subject to all the normal tariffs. If they arrive through the international postal system, however, they will be subject to an import tax of 90 percent of their value or $75 (increasing to $150 on June 1).
(The situation on the ground regularly changes but both the Peterson Institute for International Economics and The New York Times maintain detailed timelines of updated policies.)
Meanwhile, American exporters are seeing real or threatened retaliatory trade measures and consumer boycotts. At the same, Beijing has suspended exports to the U.S. of what’s known as rare earth minerals—minerals that are critical to electronics and battery production. China has also been quietly blocking imports of American meat and liquified natural gas, and stopped buying planes from Boeing. Angry Canadians are refusing to stock American products, including bourbon. And on April 22, Ottawa imposed a 25 percent tariff on U.S. certain goods.
Small businesses are beginning to speak out. Allison Luvera, co-founder and CEO of Juliet Wine, spearheaded an open letter to Trump that was signed by more than 30 female founders, explaining exactly how damaging that tariffs could be to their businesses. Others have taken to social media to share their struggles.
Legal challenges are mounting. Trump has generally used authorities granted to the president in the International Emergency Economic Powers Act to enact the tariffs using executive orders. However, the right to impose tariffs resides with Congress, according to the Constitution. So far, the Republican-controlled Congress has resisted efforts to reject Trump’s national emergency declaration.
A group called the New Civil Liberties Alliance, which has ties to conservative donors Leonard Leo and Charles Koch, filed a lawsuit in Florida on behalf of Emily Ley, the owner of Pensacola-based stationery company Simplified. The suit argues that the president overstepped his authority in invoking the IEEPA, which gives the president authority to impose sanctions and other economic punishments, but it has never been used to impose tariffs.
Other lawsuits have followed. Members of the Native American Blackfeet Nation sued the U.S. over Canadian tariffs, arguing they violate both the Constitution and tribal sovereignty agreements. The state of California and an organization called the Liberty Justice Center have also filed suits.
Rick Woldenberg, CEO of toy company Learning Resources, filed suit in Washington, D.C., challenging the tariffs. “I didn’t feel like it was an option to allow our company to be snuffed out by government policies that I think are misguided,” he told Inc.’s Melissa Angell earlier this year.
The pressure may continue to increase, as analysts predict that the full effect of the tariffs will hit over the summer, as the pre-tariff inventory that was built up winds down and prices go up.
“When it comes to small businesses, there’s no winners in the tariff game,” says D’Amato of Small Business Majority. “This is something that has been stated on a bipartisan basis, from chambers of commerce to nonprofits alike.”