It's final: Film Dev't Council can't collect amusement tax from LGUs

Image from FDCP Facebook page

MANILA, Philippines – The Supreme Court (SC) affirmed its 2015 decision declaring as unconstitutional the provisions of a law that required local government units (LGUs) to remit collected amusement tax to the Film Development Council of the Philippines (FDCP).

In a decision penned by Associate Justice Estela Perlas Bernabe, the SC said Sections 13 and 14 of Republic Act (RA) No. 9167 infringe on the principle of local autonomy as mandated by the 1987 Constitution.

It added that the provisions were legislated by Congress seemingly to set limits on LGUs' power to delegate tax.

"This, undoubtedly, is a usurpation of the latter's exclusive prerogative to apportion their funds, an impermissible intrusion into the LGU's constitutionally protected domain which puts to naught the guarantee of fiscal autonomy to municipal corporations enshrined in our basic law," the decision read.

The SC also said the FDCP failed to provide new arguments in its motion for reconsideration.

"On the constitutionality issue, FDCP's arguments in its motion are mere rehash of its position in the main and hence, cannot be sustained," said the Court.

RA No. 9167 was passed by Congress in 2002. Sections 13 and 14 of the law provided for the tax treatment of certain films.

In a statement, the FDCP said it will no longer award amusement tax privileges to films graded after December 10 this year.

"While this is truly sad news for FDCP and for the Filipino filmmakers and 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," said the council.

But in the same decision, the SC also directed the Cebu City government to give the FDCP P76.8 million, saying that the council was entitled to the funds prior to the Court's final decision.

The FDCP had said that it was only Cebu City which did not comply with the law since 2002. – Rappler.com