Donald Trump sees tariffs as the solution to many problems.

Donald Trump is shaking up Hollywood: The US president wants to impose high tariffs on films produced abroad. This could also affect the business model of US studios, as they themselves shoot a lot abroad to reduce costs.

Trump claimed that the film industry in America was dying. The reason, he claimed, was that other countries were luring filmmakers and studios from the US with various incentives. Trump's solution: a 100 percent tariff on films "coming into our country that were produced abroad."

No details were provided. It's unclear how such tariffs would even work, since films aren't imported like goods with a fixed price and are often cross-border productions. The US government would therefore have to, among other things, find a way to assess films for this purpose—and determine when they are considered imports. Commerce Secretary Howard Lutnick immediately announced he was working on the issue.

Meanwhile, Hollywood executives were trying to understand on Sunday evening what the announcement might mean for their business, the Wall Street Journal reported. They like to shoot expensive blockbusters in Canada, Great Britain, Hungary, Australia – or at Studio Babelsberg near Berlin. TV series are also often made there. And Netflix's model fundamentally involves producing anywhere in the world.

Disney's Marvel Studios, for example, just began filming the next "Avengers" film in London. Numerous films, from "Furiosa: A Mad Max Saga" to "Planet of the Apes: New Kingdom" to "The Fall Guy" with Ryan Gosling and Emily Blunt, have been shot in Australia. For the biopic "Elvis," the Gold Coast became Memphis, Tennessee.

Another problem: The tariffs could trigger retaliatory measures from other countries. But foreign markets have become increasingly important for Hollywood in recent years and bring in the majority of its revenue.

So how did Trump's initiative come about? In January, he appointed fellow actors Jon Voight, Mel Gibson, and Sylvester Stallone as his "ambassadors" in Hollywood. Voight visited Trump in Florida over the weekend. His manager, Steven Paul, previously told the financial news outlet Bloomberg that the two planned to propose to the president that filming in the US be encouraged with tax breaks. But even in completely different industries, such as the chip industry, Trump believes tariffs are a better solution than subsidies.

"Hollywood and many other areas in the US are being destroyed," Trump wrote on his online platform, Truth Social. "This is a concerted action by other nations and therefore a threat to national security."

The announcement sparked widespread concern in Australia. Culture Minister Tony Burke pledged his commitment to defending the rights of the Australian film industry. Especially as filming in the US became increasingly difficult due to the coronavirus pandemic, "Aussiewood" readily offered itself as an alternative. The government has since attracted foreign productions with substantial financial incentives. The country also offers a combination of state-of-the-art studio facilities, visual effects studios, and locations that can replicate almost any location in the world.