Press Release
August 6, 2007

Villar moves to reduce 30% amusement tax

Senate President Manny Villar yesterday filed a bill that seeks to reduce the amusement tax from the present rate of 30 percent of the gross receipt from admission fees of theaters and cinemas to 10 percent in a bid to resuscitate the current dismal state of the movie industry.

"It cannot be denied that the sorry state of our local film industry is stifling the creativity of our local artists and prohibits us from utilizing the full potentials of our filmmakers to come up with quality films as a form of art and as an educational tool for molding the character of our people," Villar said.

He added that among the reasons for the dying state of film industry are the onerous taxes, the rising cost of production, dwindling local market, competition from foreign films, competition from video and cable, censorship and uncontrolled video and cable piracy.

In filing Senate Bill 1426, Villar proposed to reduce the amusement tax from 30 percent to 10 percent of the gross receipts of ticket sales for locally-produced films.

The bill, which seeks to amend Republic Act 7160, or the Local Government Code of 1991, also gives local films a better posture to compete against foreign-produced films by proposing a 25 percent amusement tax on foreign films for the first two years.

"The imposition of 30 percent amusement tax by the local government is really quite high, which as a resultant effect, even further curbs the production, growth and development of our film industry," Villar, who is also Nacionalista Party president, said.

He added that the reduction of the amusement tax is a way of encouraging the growth, development and efficiency of the Philippine film industry.

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