Film Academy of the Philippines Director General Leo G. Martinez and several guild officials were invited to attend a hearing of the Senate’s committee on ways and means chaired by Sen. Francis G. Escudero to discuss two pending bills envisioned to revive the ailing local film industry on Tuesday, October 16.
The hearing—to be held at the Sen. Recto Room, 2nd floor of the Senate building in Pasay City—will tackle Senate Bills Nos. 4 and 71 which were introduced by Senators Jinggoy Ejercito Estrada and Loren Legarda, respectively.
Senator Estrada’s bill is titled “An Act Reviving the Philippine Movie Industry by Providing Incentives to the Proprietors, Lessees, Operators of Theaters and Cinemas” while Sen. Legarda’s bill is described as “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”.
In the explanatory note of his bill, Sen. Estrada stressed: “The Philippine movie industry has been struggling for its very existence in the face of the rising costs of production, fierce global competition and the burden of excessive taxation.”
He further noted that to revive and ensure its future,” industry leaders are now seeking Congressional intervention by way of amendatory legislation to reduce the rates of taxes that are levied and collected by the national and local governments.”
He emphasized that the movie industry shoulders about nine different kinds of taxes, duties and fees, including the cultural tax, amusement tax, withholding tax, municipal tax, value added tax, excise or specific tax on positive prints, customs duties on films, corporate income tax and the MTRCB screening fee.
Senate Bill No. 4 provides that, “Except for real property tax on land, no local and national taxes as prescribed under Republic Act No. 8424, also known as the “National Internal Revenue Code of 1997, As Amended” such as income tax, excise tax, value-added tax, and under Republic Act No. 7160, also known as the “Local Government Code of 1991” such as amusement tax, shall be imposed on proprietors, lessees, operators of theaters and cinemas in relation to the showing or exhibition of movies and films produced by the Philippine movie industry.”
In lieu of this, the bill provides that a five percent of the gross income earned shall be paid as follows—three percent to the national government and two percent shall be remitted by the business establishments op the treasurer’s office of the municipality or city where the enterprise is located. For the other bill, Sen. Legarda stated in her explanatory note that one major reason for the continuing weakening of the Philippine film industry is heavy taxation.
The lady senator’s proposed bill aims to exempt producers of films classified as general patronage and parental guidance-13 from the payment of amusement tax imposed by the local governments. The bill also exempts producers from payment of value-added tax on the importation of raw materials and equipment to be used in making films and other cinematographic works.
The committee hearing will be held in joint session with the committee on public information for Bill No. 4 and the committee on local government for Bill No. 71.