Thirty-one lawmakers are seeking to suspend the imposition of amusement tax by local governments for two years and the reduction of such levy from 10 percent to five percent of the actual gross receipts from admission fees.
Pangasinan Rep. Christopher de Venecia, chairman of the House Committee on Creative Industry and Performing Arts, filed House Bill No. 8428 or the proposed Film and Live Events Recovery Act to amend Section 140 (a) of Republic Act No. 7160, otherwise known as the Local Government Code of 1991 as amended by RA No. 9640.
“While both the live events and movie industries employ around 760,000 workers, and generate no less than P100 billion per annum for the national economy, with local governments taking a piece of that pie, it is important to evaluate the amusement tax in light of COVID-19,” he said.
He lamented the COVID-19 pandemic took its toll not just on the Philippine live events and movie industries, but also across stages, theaters, and venues across the globe.
De Venecia cited that many governments, however, were quicker to provide aid to the concerned key sectors, understanding the cultural and economic impact of keeping them afloat.
“In France, for example, the government waived the theatrical release requirement for films that were scheduled for release during the pandemic,” he said.
“The Netherlands also implemented a voucher system that have ticket holders of cancelled live events an option, an alternative to a simple refund, to hold on to their ticket until the show is allowed again or to date the payment altogether, all in order to help the shows’ producers get back up on their feet,” he added.
Joining De Venecia in filing HB No. 8428 were Reps. Angelica Natasha Co, Ma. Lourdes Arroyo, Rosanna “Ria” Vergara, Florida “Rida” Robes, Juan Miguel Arroyo, Jericho Jonas Nograles, Ronnie Ong, Loren Legarda, Marlyn Alonte, Joyce Myra Tambunting, John Marvin “Yul Servo” Nieto, Francisco “Kiko” Benitez, Claudine Diana Bautista; Cristal Bagatsing, Manuel Sagarbarria, Lorenz Defensor, Edward Maceda, Bong Suntay, Ann Hofer, Strike Revilla, Alfred Vargas, John Chistopher Belmonte, Dan Fernandez, and John Reynald Tiangco; and Deputy Speakers Deogracias Victor Savellano, Rose Marie Arenas, Evelina Escudero, Vilma Santos-Recto, Kristine Singson-Meehan, and Weslie Gatchalian.
Lawmakers noted that the amusement tax collections in the Philippines hardly account for one percent of an LGU’s revenues for a year.
In Quezon City, the biggest local amusement tax collector in the country, collection for 2019 reached more than P133 million, which accounts for only 0.6 percent of the total P20 billion revenues of the city for the same year, they said.
Makati City, another big amusement tax collector, raked in a measly P58 million as compared to its P18-billion budget, which is a mere 0.3 percent share in the pie, they added.
“Yet, on the other side, amusement taxes are significantly felt by those liable to pay. According to stakeholders, the reduction of amusement taxes will embolden them to take risks again in the holding of live events once it is already safe to do so,” they said.
HB 8428 provides that 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 five percent of the gross receipts from admission fees.
Under the measure, locally-produced operas, musical plays, and local film productions shall be exempt from the payment of amusement tax.
The bill provides that the Sangguniang Panlalawigan, which is tasked to prescribe the time, manner, terms, and conditions for the payment of tax, shall not be prevented from exempting persons from the payment of the amusement tax subject to the requirements and conditions as it may provide.
“The requirements and conditions for exemption shall be to the ultimate benefit of the arts, culture, and creative industries of the municipality and province where the collection of amusement tax is being waived,” HB 8428 said.
Under HB 8428, the power of local government to levy an amusement tax is suspended for two years from the effectivity of the proposed Act.