Hollywood is at a critical juncture as ballooning production costs and attractive tax incentives abroad have led many studios to film outside the U.S. President Trump has proposed a 100% tariff on films made internationally, which raises significant questions about enforcement and the implications for Hollywood's relationships with foreign distributors. California Governor Gavin Newsom has responded by increasing the state's film and TV tax credit to $750 million to encourage local production. However, industry experts express skepticism about the feasibility of tariffs on services like film production, highlighting the complexity of international filming arrangements. The competition from other countries, particularly Canada and various European nations, is intensifying, as they offer not only financial incentives but also skilled labor. As Hollywood navigates these challenges, the focus remains on how to retain production jobs domestically while adapting to a rapidly changing media landscape.