Lead: SAG-AFTRA is exploring a proposal—nicknamed the “Tilly tax”—that would require studios using synthetic performers to pay a royalty into union trust funds, officials say. The idea is one item on the agenda as union negotiators meet with studio representatives on Feb. 9, 2026. The proposal follows growing concern about AI-generated performers after the 2023 actors strike and high-profile digital creations such as Tilly Norwood. While the union secured some AI protections in the last round, leaders acknowledge they cannot entirely prevent AI recreations and are examining monetary remedies.
Key Takeaways
- SAG-AFTRA plans formal talks with the Alliance of Motion Picture and Television Producers on Feb. 9, 2026, with early bargaining intended months before the June 30 contract expiration.
- The “Tilly tax” would direct studio payments for wholly synthetic performers into union pension and health funds; proponents say it is a pragmatic compromise rather than a full solution.
- In 2023 the union once sought 1% of streaming platforms’ total revenue—about $500 million annually—but settled for a streaming “success bonus” projected at $40 million per year, which has underperformed.
- AMPTP has named Greg Hessinger as lead negotiator; he is a former SAG leader and may negotiate differently than predecessor Carol Lombardini.
- AI remained central to the 2023 strike and prompted a yearlong dispute with the video-game sector; the union has already secured some royalties for synthetic performances in commercials and recordings.
- Other unresolved priorities include residuals parity with network television, limits on exclusivity during long streaming hiatuses, and the continued use of self-taped auditions.
Background
Artificial intelligence and digital likenesses became focal points during the 2023 SAG-AFTRA strike, when actors pushed for guardrails to protect work and compensation. The emergence of sophisticated synthetic performers—most visibly the digital figure known as Tilly Norwood in late 2025—crystallized those fears and pushed the union to seek enforceable remedies. At the same time, the industry’s shift to streaming has hollowed out the traditional rerun-residual economy that once supported many performers between jobs.
Historically, actors earned recurring pay when broadcast and cable reruns aired; streaming platforms have disrupted that model, often replacing steady residuals with one-time or modest success bonuses. The 2023 negotiations produced a streaming success bonus that union leaders hoped would begin to address the gap, but many members remain dissatisfied that it falls far short of earlier demands. Separately, after the strike the union engaged in a prolonged fight with the video-game sector over AI and secured some protections with record labels and commercial producers for synthetic performances.
Main Event
Union leaders, including chief negotiator Duncan Crabtree-Ireland and president Sean Astin, will meet AMPTP representatives on Feb. 9 to begin talks well ahead of the June 30 contract deadline. One agenda item is whether studios that deploy wholly synthetic actors—models not based on a hired performer—should pay a royalty into union-managed funds. Advocates frame this as a way to capture value that would otherwise accrue without performer compensation.
SAG-AFTRA’s AI task force has discussed the studio-royalty idea as a fallback option. Brendan Bradley, a task-force member, described the plan as imperfect but potentially the most viable compromise available in 2026. The union remains cautious about locking in a single approach given legal, technological and enforcement uncertainties around synthetic likenesses.
On the studios’ side, the AMPTP has appointed Greg Hessinger as the lead negotiator. Industry officials say Hessinger’s background as a former SAG leader could open space for more flexible bargaining compared with the previous AMPTP lead, Carol Lombardini. An AMPTP spokesperson said studios are aiming for a “fair deal” that sustains performers and the industry’s long-term stability, signaling willingness to engage on several fronts.
Analysis & Implications
Monetizing synthetic performances through a studio levy would create a new revenue stream for performer benefit funds but raises questions about scope and enforcement. Determining what qualifies as a “synthetic performer,” measuring usage, and setting a rate will be technically and legally complex. Studios may resist any mechanism that feels like a de facto tax on innovation, while unions will push for predictable, auditable contributions tied to industry practice.
If adopted, a Tilly tax could partially offset lost residual income by channeling payments into pension and health plans, preserving some elements of the old compensation ecosystem. However, the approach does not restore pay-per-play mechanics and may not satisfy members who want direct per-use payments. The measure would likely spur litigation or regulatory review, setting precedents for other creative sectors and jurisdictions considering AI governance.
For studios and independent producers, the levy would alter project cost models, potentially affecting investment choices for effects-heavy or fully synthetic productions. International productions introduce further complexity: payments and protections negotiated in the U.S. contract may not reach performers abroad unless mirrored by foreign unions or local rules. Finally, the proposal underscores that bargaining over AI will be an ongoing process rather than a one-time fix.
Comparison & Data
| Compensation Model | Typical Annual Value (example) | Notes |
|---|---|---|
| Broadcast/Cable Residuals | Variable; historically substantial for hits | Pay-per-rerun model sustained many performers long-term |
| Streaming “Success Bonus” (settlement) | Projected $40,000,000/year | Actual receipts have trailed projections |
| Union Demand (2023) | 1% of streamer revenues ≈ $500,000,000/year | Was not achieved; illustrative of union’s earlier bargaining position |
| Proposed “Tilly tax” | Undetermined | Would be royalty-style payment directed to pension/health funds |
The table compares historic broadcast residuals, the current streaming bonus, the union’s 2023 revenue demand, and the newly proposed levy. While broadcast-era residuals offered recurring income tied to reuse, streaming compensation has been smaller and more variable. The Tilly tax is intended to capture studio value when synthetic performers substitute for hired actors, but its eventual scale remains undefined.
Reactions & Quotes
Union leaders and members expressed mixed feelings: some view a levy as a concessionary but necessary compromise; others call for stronger protections that emulate pay-per-use models. Studio representatives framed negotiations as a chance to reach balanced terms that support both creative labor and production economics.
“Is that a perfect solution? No. But it’s under the category of the best bad idea we’ve got in 2026.”
Brendan Bradley, SAG-AFTRA AI task force member
Bradley framed the Tilly tax as a pragmatic fallback rather than an ideal fix, emphasizing the union’s limited options in the near term.
“We look forward to reaching a fair deal that supports actors and the industry’s long-term stability.”
AMPTP spokesperson
The AMPTP statement signals an intent to bargain in good faith but does not specify positions on royalties or specific AI controls.
“No actor wants that… I say no, no and triple no. But if it has to be, it should go into pension and health.”
Erik Passoja, former co‑chair, SAG-AFTRA L.A. New Technology Committee
Passoja expressed strong opposition to synthetic replacements while indicating conditional acceptance of a levy if proceeds fund core performer benefits.
Unconfirmed
- Whether the Tilly tax will be included in the Feb. 9 bargaining agenda as a formal studio-side proposal rather than a union countermeasure remains unconfirmed.
- Exact revenue estimates or a proposed rate for any studio levy have not been released publicly and remain undetermined.
- Timing and scope for the user-created Leia and Elsa clips reportedly headed for Disney+ are not independently verified and may change.
Bottom Line
The Tilly tax idea reflects a pragmatic shift in union strategy: accepting that outright bans on synthetic actors are unlikely and seeking instead to recover value for performer benefits. If negotiated into the next contract, it would create a new mechanism to channel compensation into established funds, albeit without restoring the pay-per-play economics many actors prefer.
Negotiations beginning Feb. 9 will test whether studios accept a royalty model and how negotiators resolve other unresolved priorities such as residual parity, exclusivity limits, and audition practices. Given legal, technical and international complexities, expect AI-related bargaining to continue beyond the current contract cycle and to influence industry norms for years.
Sources
- Variety — (Entertainment trade reporting; primary article summarizing negotiations and union comments)
- SAG-AFTRA — (Official union site; context on contract cycles and member protections)
- Alliance of Motion Picture and Television Producers (AMPTP) — (Industry trade organization; statements and negotiation representation)