THE Supreme Court (SC) has affirmed with finality its 2015 decision to disallow the Film Development Council of the Philippines (FDCP) from collecting and giving film amusement taxes as incentives to select films.

“While this is truly sad news for FDCP and for the Filipino filmmakers and the industry that the agency has served and supported through monetary incentives from the amusement tax collections, FDCP respects the Court’s final decision and will abide by it. FDCP will work swiftly to ensure all the remaining remittances due to the producers who applied prior to the finality of the decision will be awarded accordingly,” the FDCP said in a statement published on its Facebook page on Dec. 11.

The council noted they received a copy of the Court’s resolution on Dec. 10.

The 2015 dispute stemmed from Cebu City along with Colon Heritage Realty Corp. and SM Prime Holdings contesting FDCP’s collection of amusement taxes saying that it would reduce their revenues.

In the original ruling, the high court en banc nullified Sections 13 and 14 of Republic Act No. 9167 which allowed the FDCP to collect 100% and 65% of local amusement taxes and reward these to films graded A and B by the Cinema Evaluation Board.

The collected amusement tax was meant to incentivize local filmmakers and, in turn, promote better quality local films.

The high court deemed the amusement tax collection a “violation of the principle of local fiscal autonomy since it authorized FDCP to earmark, and hence, effectively confiscate the amusement taxes which should have otherwise inured to the benefit of the local government units,” according to the FDCP statement.

Because of the decision, the FDCP announced that it will no longer award amusement tax privileges to films graded after Dec. 10, 2019, but that it will continue transacting with the concerned theater branches for the collection of amusement taxes for films graded prior to the date of the resolution.

Despite the setback, the FDCP said it will be “working closely with lawmakers in the country for its proposed film fund and incentive programs that will replace and sustain its support to our local filmmakers.” — ZBC