What is the Tilly Tax?
As the entertainment industry grapples with the rapid rise of synthetic and AI-generated performers, SAG-AFTRA is reportedly considering a policy idea known informally as the “Tilly tax.” The core concept envisions studios paying a royalty into a union-backed fund whenever they employ digital or AI-generated actors in place of traditional human performers. The proposal is still in a formative stage, with union leaders and studio executives preparing to meet on February 9 to discuss potential models, boundaries, and enforcement mechanisms.
Why a Royalty Might Be on the Table
The debate centers on several practical and ethical questions. First, AI-generated performances can replicate or remix the work of living actors, potentially reducing the demand for new human work or shifting bargaining leverage away from performers. Second, digital replicas—down to voice, likeness, and performance micro-details—raise concerns about consent, compensation, and residuals for artists whose likenesses could be mined without ongoing labor negotiations. A royalty scheme would create a predictable fund for the union to support its members affected by AI-driven productions while also providing a path for actors to benefit from innovative uses of their digital likenesses.
How Could It Work?
Details are not finalized, but several elements are under discussion:
- <strongFund mechanics: Studios would contribute to a dedicated pool tied to the amount and type of AI usage, perhaps calculated by project budget, duration, or the degree of synthetic performance employed.
- <strongRoyalty distribution: The fund could support actor training, health and retirement benefits, or new residuals when AI is used beyond clear, non-human roles.
- <strongScope: The policy might distinguish between fully synthetic performances and digital doubles used under specific agreements, ensuring a fair approach that doesn’t penalize lower-budget productions.
- <strongConsent and control: Any plan would likely address who controls the licensed likeness and how actors can opt out or monetize future digital representations of themselves.
<h2 Implications for Actors, Studios, and Creators
For actors, a Tilly tax could offer a safety net as AI permeates more roles, especially in background, motion capture, or high-volume voice work. It could also provide a vehicle for negotiating terms that reflect the value of a performer’s digital identity. For studios, the idea promises a balance between innovation and compensation, potentially slowing the pace of AI adoption if the financial burden is significant or easily exploitable by competitors.
Creators and screenwriters will also want to watch how these discussions intersect with broader issues of IP, contract language, and the evolving definition of authorship in an AI-driven era. The conversations could usher in new licensing norms, data rights, and transparency requirements around how AI models are trained and used in productions.
<h2 What This Means for the February Negotiations
The Feb. 9 negotiations between SAG-AFTRA and studio representatives will likely test not only the viability of the Tilly tax concept but also the industry’s willingness to reform compensation in a landscape where digital actors are becoming more capable and popular. Expect a robust debate over how to measure AI usage, how to fund protections for workers, and how to ensure that performers retain control over the use of their likenesses in perpetuity.
<h2 A Path Forward
While the exact structure of any “Tilly tax” remains to be defined, the proposal signals a broader shift: unions are seeking proactive, fair compensation mechanisms for the era of AI and digital performers. If adopted, such a policy could set a global precedent, prompting other unions and guilds to seek similar funding models that support performers whose work is increasingly mediated by machines.
As negotiations continue, the industry will need to balance technological progress with the livelihoods of artists who bring characters to life. The fate of the so-called Tilly tax will hinge on its ability to protect workers, incentivize innovation, and create transparent, enforceable standards for the use of digital performances.
