MMDA execom: Funds intact, accounted for

MANILA, Philippines - The executive committee of the Metro Manila Film Festival (MMFF) on Thursday denied claims that earnings from the annual movie festival are mishandled.

MMFF execom spokesperson Marichu Maceda said the funds of the organization, particularly the amusement tax collections, remain intact and accountable contrary to the allegation by the Film Academy of the Philippines.

She added that the funds have been properly distributed to its intended beneficiaries.

"The MMFF Execom is mandated to allocate and remit to the designated beneficiaries the net proceeds of the amusement taxes after deducting all operational and incidental expenses of the MMFF. This is being complied with religiously every year," Maceda said, citing the provisions of the Metro Manila Council executive order that established the Metropolitan Manila Development Authority’s operation and management of the annual film festival.

The MMFF derives its tax revenues from the amusement taxes waived and donated by the 17 Metro Manila local government units during the 10-day festival that runs from December 25 to January 3.

To evaluate its overall annual performance, Maceda said the MMFF takes into consideration both the gross revenues of Metro Manila and provincial theaters.

Maceda, however, pointed out that due to changes in the amusement tax structure, gross revenues from Metro Manila theaters are further reduced by the following factors:

1. Since 2003, Quezon City, Manila, Caloocan, Malabon, and San Juan reduced its amusement tax rate from 30 percent to 15 percent
2. In 2006, Quezon City further reduced its amusement tax rate from 15 percent to zero percent. All other LGUs reduced their amusement tax rate to 10 percent pursuant to Republic Act 9640, amending section 140A of Republic Act 7160, otherwise known as the Local Government Code of 1991.
3. In 2011, Marikina followed Quezon City’s example, bringing down its amusement tax rate also to zero percent
4. Pasay City also decreased its local amusement tax from 10 percent to five percent
5. Resorts World Cinemas are tax-free under the Philippine Economic Zone Authority  law
6. Closure of several movie houses

Maceda also noted that the amusement tax derived by Quezon City, which is tax-free, comprised about 30 percent or 102 theaters of the total amusement tax collections of the MMFF, significantly reducing the net proceeds of the tax in relation to the gross revenues.

"Even if the MMFF gross revenues increase, the amount given to beneficiaries may decrease due to these factors," she said.

Under the Nov. 22, 2010 directive of the Office of the President, the bulk of the amusement tax proceeds goes to the Movie Workers Welfare Foundation, Inc. or Mowelfund, which gets 50 percent; FAP, 20 percent; Motion Picture Anti-Piracy Council, 20 percent; Optical Media Board, five percent; and Film Development Council of the Philippines, five percent.

Maceda pointed out there is no transmittal of proceeds to the MMDA because it is not a beneficiary of the MMFF fund.

As to the case filed by FAP, Maceda said the MMFF Execom will answer the charges in court, stressing that FAP has no basis to claim P82 million in amusement tax proceeds earned by the MMFF from 2002 to 2008.

The recent MMFF garnered close to P1 billion in revenues, making it the most successful and highest-earning festival in its 39 years of history.