Action! Dispute Over Foreign Film Royalties Debuts at Tax Tribunal

Posted: April 13, 2011 in News

By : JG, Antara

The dispute between the government and foreign film importers said to owe the state millions of dollars in unpaid royalties has finally landed at the tax tribunal.

Thomas Sugijata, director general for customs and excise at the Finance Ministry, confirmed on Tuesday that three film importers the government said owed Rp 31 billion ($3.6 million) in unpaid royalties and fines were appealing the claims.

However, Thomas could not confirm whether or not the companies had paid half the amount claimed before the March 12 cut-off date, which is a prerequisite for appealing to the tax tribunal.

“I haven’t checked with the tax tribunal,” he said.

“Maybe later we can see if they had made the payments or not. It’s still to be processed, but I heard that they have filed an appeal.”

According to the tax law, film importers must pay 23.8 percent of a film’s customs value, including import tax, value-added tax and income tax.

The dispute centers on royalties, which were previously not factored into the cost because distributors argued that the amount would not be known until after the films had been screened.

However, the government now wants to tax royalties up front.

The finance minister is considering a review of the way royalties are calculated and may make an announcement on National Film Day, which falls on March 30.

 

The original article can be found here:

http://www.thejakartaglobe.com/home/action-dispute-over-foreign-film-royalties-debuts-at-tax-tribunal/431020

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