CEBU, Philippines - What is generally considered as a small-time cinema house along Colon Street has delivered a big victory for Cebu, which could reverberate around the country.
The Colon Heritage Realty Corporation, operator of Oriente Group of Theaters, won in the case it filed against the Film and Development Council of the Philippines (FDCP).
Judge Douglas Marigomen of Regional Trial Court Branch 5 declared illegal the collection of amusement taxes by FDCP from movie houses.
He ordered FDCP to refund the total amount that Colon Heritage has paid to the council.
Marigomen also declared invalid and unconstitutional Republic Act 9167 or the Act Creating the Film Development Council of the Philippines.
Colon Heritage earlier filed a civil case asking the court to stop the FDCP from collecting amusement tax as they are also paying the same tax to the Cebu City Government.
Marigomen ruled that Section 14 of RA 9167 is a direct violation of the constitutional policy of local autonomy.
Section 14 of RA 9167 directed proprietors, operators or lessees of theaters or cinemas not to remit amusement taxes to all local governments in highly urbanized and independent component cities for films classified as Grade A or B.
It also says that if the proprietors, operators or lessees of theaters or cinemas failed to remit amusement tax to the FDCP they will be held liable to a surcharge equivalent to five percent of the amount due for each month of delinquency which shall be paid to the council.
Marigomen stated that this provision violates the 1987 Constitution.
“It is a usurpation of the power of the (local government units) LGUs to acquire exclusive benefits from amusement taxes imposed and collected by them,” the judgment reads.
He cited the case of CIR vs. SM Prime Holdings where the Supreme Court ruled that the amusement tax on cinema and theater operators or proprietors remained with the local government.
The law was approved by then President Gloria Macapagal Arroyo on June 7, 2002.
Valeriano ‘Bobit’ Avila, vice president of Colon Heritage, told The Freeman it was only Cebu that raised opposition to FDCP’s collection of amusement taxes.
Avila said the decision of Marigomen was a lesson for Congress not to enact laws that will breach local autonomy./MBG (FREEMAN)