You see, besides the anti-piracy bill that he has recently filed, Sen. Angara has also authored a Senate Bill (No. 1801) providing for the retention of the 10 percent withholding tax. If the bill is approved, soon hopefully (and industry people are keeping their fingers crossed), it would over-rule the 20 percent tax imposition which is considered by industry people as a cruel stab on their side.
Isn’t it ironic that it has to be a non-showbiz Senator who would come to the rescue of the beleaguered industry which is already burdened to death with all sorts of taxes? Where are the likes of "showbiz" Sen. Tito Sotto, Sen. Ramon Revilla, Sen. Loren Legarda and Sen. Noli de Castro – or even Senators Ralph Recto and Kiko Pangilinan whose wives, Vilma Santos and Sharon Cuneta respectively are among those hard hit by the 20 percent "Damocles Sword"?
The other night, Sen. Angara and his wife, the charming Gloria Manalang-Angara (said to be "the original GMA"), met with movie writers from major dailies at a dinner at the Chinese restaurant of New World Hotel in Makati. Regal Matriarch Mother Lily (Monteverde) and daughter Roselle, organizers of the salu-salo,meant it to be a friendly chit-chat – until the piracy problem (which has been slowly but surely killing the local movie and recording industries) and the 20 percent withholding tax (same effect on industry people) cropped up.
That’s when those present (also including direk Boots Plata and wife Dolor Guevarra) started congratulating Sen. Angara for being such a champion ("hulog ng langit") to the industry workers.
Sen. Angara’s anti-piracy bill has been widely publicized so Funfare won’t go into details. Instead, I’m printing in full the "explanatory note" of Sen. Angara’s bill on the 20 percent withholding tax. Here it is:
The alarming proportions assumed by film piracy has resulted in serious losses for the entertainment sector. As a result, attendance in local movie theaters has dropped by 50 percent over the last four years. Losses to the Philippine film industry reached around P1 billion, with 40 percent of revenues of the film industry eaten up by pirates.
As a result, the entertainment industry is ailling, with a lower number of movies being produced each year. This has resulted in the loss of livelihood of thousands of people dependent on the film industry. At the same time, those who continue working in the entertainment sector are now suffering from severely lowered incomes.
These problems, together with the economic crisis the Philippines is undergoing, make it imperative to ensure that the incomes of people working in the entertainment sector are not further decreased. Consequently, creditable withholding tax rates applicable to professional entertainers, directors, and recipients of talent fees (together, "Entertainers") be retained at their current level of 10 percent, until such time that the film and entertainment industry will be revived.
This bill seeks to retain withholding tax rates of Entertainers at the current 10 percent, in light of the effectivity of Revenue Regulations No. 12-2001 issued by the Commissioner of the Bureau of Internal Revenue increasing this rate to 20 percent. Although it is important for the government to step up its tax collection efforts and review tax rates, the problems faced by the entertainment industry in particular call for the retention of the lower withholding tax rate, until such time when the entertainment industry is able to revive itself.
For the abovementioned reasons, the immediate approval of this bill is earnestly sought.