Trump's tariffs could push up BBC licence fee, Tories warn

Telegraph

07-05-2025

Trump's proposed 100pc tariff on foreign films could push up the cost of the BBC licence fee, the shadow culture secretary has warned.
The UK government said it was in 'active discussions' with the White House after the US president suggested he may apply tariffs to foreign-made films to revive America's movie industry.
The move could cripple the revenue of BBC Studios, the corporation's commercial arm, which last year made £454m by selling productions to the American market, according to its annual report. Some of its most notable exports include Doctor Who and David Attenborough's Frozen Planet films.
It is unclear whether Trump's tariffs will be applied solely to films or also television series.
Either way, shadow culture secretary, Stuart Andrew, warned the loss of income could leave British licence fee payers footing the bill.
In an urgent question to the Government on Wednesday, he asked: 'What assessment have they made on the potential drastic cut in the BBC Studios profits, that sells into the US market, could have on the licence fee?'
Sir Chris Byrant, the culture minister, said in response that Labour was 'already in active discussions with the top of the US administration on this subject'.
More than £1.8bn was made by BBC Studios last year by selling its popular British film and television productions to audiences around the world, down from £2.1bn in 2023.
The money is a lifeline for the corporation as more viewers cancel their licence fees and turn to streaming services like Netflix instead.
When asked by The Telegraph how it planned to deal with the impact of the tariffs should they come into effect, the BBC declined to comment.
Mr Andrew said it was proof Labour should have begun trade negotiations with President Trump sooner.
He told The Telegraph: 'They wasted five months when they could have been negotiating. They need to highlight [to President Trump] that tariffs will hurt US businesses as they have invested in UK facilities.'
The Government is racing to seal a trade deal with President Trump to reduce the impact of his tariff regime – under which UK exporters will pay a blanket 10pc tariff. Last month, Trump initiated a 90-day pause before the regime was implemented.
On Tuesday, it was reported Angelina Jolie's father, Jon Voight, had advised the White House to include films produced outside of the US in its tariff war in a bid to save Hollywood.
However, the President appeared to soften his stance late on Tuesday, telling CNBC: 'I'm not looking to hurt the industry, I want to help the industry.'
Experts said it may spark a total overhaul of the £174.50 annual licence fee scheme.
Patrick Barwise, emeritus professor of management and marketing at London Business School, said: 'This will further feed into a sense that it is going to damage BBC Studios ability to generate revenue from [the US] market.
'The contributions from BBC Studios are used to subsidise the licence free. My hunch is that we'll end up with a different model from the licence fee.'
He added it was 'another blow on top of the massive funding cuts since 2010. This is going to hit its exports but also it will hit other UK studios. It hits the whole distribution system and it will increase costs'.
The BBC's charter, which authorises it to administer the licence fee to generate profit, is due to end in 2027, with discussions between the corporation and the Government starting this year and its renewal thereafter.
Lisa Nandy, the culture secretary, previously criticised the model as 'unenforceable'.
A government spokesman said: 'Talks on an economic deal between the US and the UK are ongoing – but we are not going to provide a running commentary on the details of live discussions or set any timelines because it is not in the national interest.
'We will continue to take a calm and steady approach to talks and aim to find a resolution to help ease the pressure on UK businesses and consumers.'