Press Release
June 28, 2009

Villar sees movie industry boom with lower tax

The Nacionalista Party (NP) led by Sen. Manuel Villar has expressed confidence that a new law slashing the amusement tax to just 10 percent would instantly invigorate the Philippine film industry.

"With the tax reduced by two-thirds, we are absolutely hopeful that industry players will now find it even more rewarding to produce top-quality films that enrich culture and reinforce the national identity," said NP spokesperson and former Cavite Rep. Gilbert Remulla.

He said the NP now considers the local film industry "a potent driver of economic and employment growth."

"We are definitely counting on an explosion of local films and a consumption surge by moviegoers to stimulate domestic economic activity and jobs creation, besides enlivening free artistic and intellectual expression," added Remulla, former chairman of the House committee on public information.

Under Republic Act 9640, which has lapsed into law without President Macapagal-Arroyo's signature, the maximum amusement tax that may be collected by provinces has been lowered from 30 percent to only 10 percent.

The new law takes 15 days after publication in the Official gazette or in at least two national newspapers.

Villar is one of the principal authors of the new law. The Senate approved its version of what is now RA 9640 when Villar was Senate President.

Under the Local Government Code, provinces are empowered to levy an amusement tax on the admission fee gross receipts generated by proprietors, lessees or operators of theaters, cinemas, concert halls, circuses, boxing arenas and other places of recreation.

In the case of theaters and movie houses, the tax is withheld by their proprietors, lessees or operators and then remitted to provincial treasurers. The tax income is then shared equally by the province and the municipality where the amusement places are located.

Under the new law, the following are exempt from paying the tax: the conduct of operas, concerts, dramas, recitals, painting and art exhibits, flower shows, musical programs, literary and oratorical presentations, except pop, rock, or similar concerts.

The country has a colorful filmmaking history. At the height of the Golden Age of Philippine Cinema in the 1950s, four big studios -- LVN Pictures, Sampaguita Pictures, Premiere Productions and Lebran International -- together produced over 350 films every year.

Congress instituted the Film Development Council in 2002 to advance the art and craft of filmmaking, and push productions that "enhance the quality of life, examine human and social conditions and contribute to the dignity and nobility of the human spirit."

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