Jun 08
10% AMUSEMENT TAX IMPLEMENTED SOON by fapweb  |  Posted in Articles  |  on Mon, Jun 8, 2009

Pending its publication and the 15-day period after such, the 10 percent amusement tax law will be implemented after the period of presidential action lapsed last May 20.

This was announced by Senator Ramon ‘Bong’ Revilla who fought for the bill in the Senate when it was approved in June last year. The House of Representatives passed the same bill last January which lowered the amusement tax from 30% to not more than 10% of cinemahouses’ admission tickets.

The later House bill was authored by Congressmen Irwin C. Tieng, Eduardo C. Zialcita, Rufus B. Rodriguez and Marcelino R. Teodoro.

House Bill No. 4367 (titled An Act Amending Section 140 (A) of Republic Act. No. 7160, Otherwise Known as “The Local Government Code of 1991”) stressed:

“The Bill aims to lower or reduce the rate of amusement tax from 30% to 10% on gross receipts of the admission fees on theaters and cinemas, amending Section 140 of the Local Government Code of 1991. In so doing, we will be able to help our proprietors, lessees and operators, and encourage more investments and innovations on their part. Our local theater and film producers, to include the technical people, will benefit from this measure, and be able to produce quality films that are culturally, politically and economically beneficial.”

At present, the local film industry is suffering from multiple taxes like the 30% amusement tax, the 12% value added tax (VAT) on imported filmmaking raw materials and equipment, 35% corporate income tax and 5% withholding tax on producer’s film share.

On June 4, 2008, Senate Bill 2325–prepared jointly by the committees on local government and on ways and means with Senators Loren Legarda, Ramon ‘Bong’ Revilla Jr., Benigno Aquino III and Francis ‘Chiz’ Escudero—was approved by the Senate.

The Senate Bill reads in part:

Section 1. Section 140 of Republic Act No. 7160, otherwise known as “The Local Government Code of 1991” is hereby amended to read as follows:

Section 140. Amusement Tax.- (a) The province may levy an amusement tax to be collected from the proprietors, lessees or operators of theaters, cinemas, concert halls, circuses, boxing stadia and other places of amusement at a rate of not more than [thirty percent (30%)] TEN PERCENT (10%) of the gross receipts from admission fees.

(b) In case of theaters or cinemas, the tax shall first be deducted and withheld by their proprietors, lessees or operators and paid to the provincial treasurer before the gross receipts are divided between said proprietors, lessees or operators and the distributors of the cinematographic films.

(c) The holding of operas, concerts, dramas, recitals, painting and art exhibitions, flower shows, musical programs, literary and oratorical presentations, except pop, rock or similar concerts shall be exempt from the payment of the tax herein imposed.

The approved senate bill was in substitution of bills nos. 71, 717 and 1426.

Senate Bill 71 was introduced by Sen. Legarda and is entitled “An act exempting the Philippine film and movie industry from the payment of certain taxes, amending for the purpose certain provisions of the Local Government Code of 1991, the National Internal Revenue Code of the Philippines, and for other purposes.

Senate Bill 717 was introduced by Sen. Revilla and is entitled “ An Act amending Section 140 of Republic Act 7160, otherwise known as the “Local Government Code of 1991” and for other purposes.

Senate Bill 1426 was introduced by Senator Manuel Villar and is entitled “An act reducing the rate of amusement tax on admission fees of theaters and cinemas, amending for the purpose paragraph (A) Section 140 of Republic Act No. 7160, otherwise known as The Local Government Code of 1991, and of other related laws.


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