The House minority members have made a last-minute push for the inclusion of financial incentives for the rapidly declining local movie industry in President Rodrigo Duterte’s proposed Tax Reform for Acceleration and Inclusion (TRAIN) Act.
“We are convinced that a breathing spell will help revive the local film industry, which has the potential to contribute appreciably to jobs creation, increased consumption and overall economic expansion,” House Senior Deputy Minority Leader and Buhay Rep. Lito Atienza said.
“The proposed five-year tax holiday for local film producers should be incorporated into the final version of TRAIN. Should the House majority ignore our plea, we are counting on the Senate to be more sympathetic to the plight of our filmmakers once the bill reaches the other chamber,”Atienza said.
TRAIN, or House Bill (HB) 5636, seeks to slash personal income taxes while imposing new excise taxes on oil products, sugary drinks and cars to help fund the administration’s 10-point socioeconomic strategy forall-encompassing growth.
Atienza is author of the proposed Philippine Film Industry Tax Holiday Act, or HB 2624, which seeks to grant new tax privileges to local producers who have been reeling from intense foreign competition.
He said the local movie industry has been “waning fast” due to lack of financial stimulus.
“We used to have a highly vibrant movie industry that employed a lot of people and produced around 300 films every year. Now we are producing less than 50 every year,” Atienza, former three-term mayor of Manila, said.
“We ought to be producing and exporting high-quality movies by now, just like South Korea and India, but we’re not,” he pointed out.
Local producers desperately need financial encouragement to be able to compete here and abroad against movies made in Hollywood, Bollywood and South Korea, Atienza said.
“We have highly creative producers, directors and screenwriters, but they’ve been discouraged by the rising cost of making movies, which has made it extremely difficult, if not impossible for start-ups to come in,” he said.
Under Atienza’s bill, movies graded “A” by the Film Development Council of the Philippines (FDCP) shall be entitled to a financial reward equal to 100 percent of the amusement tax collected from exhibitions.
Movies graded “B” shall get a reward equal to 65 percent of amusement tax generated, with the balance of 35 percent accruing to the FDCP.
The bill also empowers the FDCP to:
•Exempt from taxes and duties all imported machinery and equipment and corresponding spare parts used to produce local movies;
• Grant tax credits to domestic manufacturers of machinery and equipment used in producing local movies;
•Waive taxes on the rental of machinery and equipment used to produce local movies; and
• Free from taxes the editing, promotional and marketing fees paid by local movie producers.
