“Tinseltown” has lost its lustre, said The Hollywood Reporter. The biggest players in movie and streamer TV production have moved headquarters to London, filming in “state-of-the-art shooting facilities” in and around the UK capital.
“Brollywood” is booming, after years of struggle, thanks to Britain’s generous tax breaks and cheaper labour. But there’s a black cloud on the horizon, as Donald Trump threatens to impose 100% tariffs on “films made in foreign lands”.
‘Best’ tax breaks in the world
The UK’s film and and TV studios and soundstages are “running at full capacity”, said The Hollywood Reporter. Production revenues reached £5.6 billion in 2024, up 31% from the previous year, according to the British Film Commission. And £4.8 billion of that came from external investment and international co-productions.
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Disney’s Marvel Studios, for example, recently made a “huge move” out of Georgia in the US to take “a long-term lease” at Buckinghamshire’s Pinewood Studios, said Screen Rant. The forthcoming Spider-Man movie, as well as the next two Avengers movies will be filmed there.
Key to Brollywood’s success has been a “competitive and well-developed tax incentive system”, said City A.M. Not only can producers shooting in the UK claim 40% off their final tax bill, the Audio-Visual Expenditure Credit provides them with a tax credit worth 34% of their production costs and 39% of their visual-effects costs. Indie films with budgets of less than £15 million can also use the Independent Film Tax Credit to claim 53% back. These tax breaks ”are among the best in the world,” said The Hollywood Reporter.
On top of all that, the UK has an established, experienced, cheaper workforce and, crucially for US production companies, said Screen Rant, there’s no requirement, as there is in America, to “subsidise workers’ medical expenses”.
Threat of tariffs
Brollywood’s boom, though, has meant Hollywood’s contraction. Once the “global hub of film, wealth and glamour”, Los Angeles has “become a casualty of the worldwide production plunge”, said The Hollywood Reporter. The number of productions filming in the US in the second quarter of 2024 was down 37% compared with the same period in 2022, according to industry tracker ProdPro.
Enter President Trump. Diagnosing the US film industry to be facing a “very fast death”, he declared his intention to “‘make Hollywood great again’ by wielding his preferred economic weapon – tariffs”, said The New York Times.
His threat of 100% levies on foreign-made films remains just a threat for now – and it is unclear how he would actually implement it – but there is concern that even uncertainty around tariffs could “wipe out” the gains made British film and TV production has made since the dearth of work during the pandemic and then the US screenwriters’ strike.
The worry about tariffs is “really disempowering” and “destabilising”, Marcus Ryder, chief executive of the Film and TV Charity, told The New York Times. “Even a short-term tariff could have a long-term devastating effect on the workforce.”
