News / Asia

    Indonesian Tax Dispute Shuts Out Hollywood Blockbusters

    People walk past movie banners outside a movie theater in Jakarta, Indonesia (File Photo - February 21, 2011)
    People walk past movie banners outside a movie theater in Jakarta, Indonesia (File Photo - February 21, 2011)

    The months of June, July and August are when Hollywood releases its blockbusters, the big-budget films aimed at appealing to global audiences. But this year in Indonesia, an ongoing tax dispute between the government and film importers continues to shut out new releases and cinema owners say it is crushing their profits.

    B-grade horror flicks and Thai comedies like Dear Galileo, are among the limited choices facing Indonesian moviegoers this season. Nearly four months after the Motion Picture Association of America stopped sending films to the country in protest against a new tax levy, Indonesians say they are frustrated and embarrassed by not having access to the latest blockbusters.

    Film buff Walter Francine says he fears missing out on big-name summer sequels, some of which are already showing up in neighboring countries.

    “We’re quite disappointed actually," he said. "We cannot see Thor, Green Lantern and then Pirates of the Caribbean maybe. Some of my friends may be going to Singapore.”

    In January the Indonesian government announced it would start enforcing a long-neglected regulation that slaps an up-front royalty duty on imported films in addition to a customs tax that already charges importers $0.43 cents per meter of celluloid.

    The Motion Picture Association, which represents major studios such as Walt Disney, Paramount and Universal, says the royalty tax is unfair since it seeks to put a value on films before they have earned any revenue.

    Meanwhile, Indonesia’s tax department has billed its three main film distributors $3.6 million for two year’s worth of back taxes. It has suspended their import licenses until they settle up.

    One importer recently paid, but the other two are fighting the government in tax court. They are part of the dominant Group 21, which controls more than 80 percent of the 620 screens in the country and is the sole importer of Hollywood flicks.

    The Indonesian government says it is enforcing the royalty tax to boost the local film industry, but one cinema group leader believes it is in reaction to importers not fulfilling their tax obligations.

    Figures for Indonesia’s total box office take vary between $90 million to $150 million, slightly below Singapore, but twice as big as Thailand. With a population of around 240 million people and a rising middle class, there is plenty of room to grow, says Ananda Siregar, the head of Blitz Megaplex, Indonesia’s second-largest cinema chain.

    “Unfortunately, with the current situation happening, the ones who are going to benefit are either the pirates or Singapore, because most Indonesians who can afford to go to Singapore will fly up there and watch Kung Fu Panda there instead of in their own country, which is very sad,” said Siregar.

    The government says it is working to resolve the royalty duty, but Siregar worries that even if that issue is resolved, films will not start flowing back into the country until the distributors pay their back taxes.

    Since the film boycott started Blitz has shortened its operating hours and closed some screens on a rolling basis. The head of Indonesia’s cinema union says theaters have reported a 60 percent drop in revenue and independent cinemas are in danger of closing permanently.

    Some moviegoers say they understand the principal behind the boycott. The distributors should pay up, they say. As Arie Jony waited in line outside Jakarta Cineplex, he says the loss of revenue only harms the industry.

    “It’s very disappointing for me," he said. "Plus it will push people more to buying pirated videos, they will tend to download more films from the Internet and everything. So in my point of view there is nothing to gain by this ban.”

    While pirated DVDs are available for even the latest Hollywood releases, many Indonesians say they miss seeing the films in the theater.  Jony says he has stopped his weekly movie theater visits because of the limited selection of films. Moviegoer Amanda Waworunto says she too is dismayed by the lack of international offerings.

    “We actually admit that Indonesian film is very bad quality, so I will never watch it in theater anyway,” she said.

    A few Hollywood films from smaller studios not involved in the MPAA boycott are reaching Indonesia. The latest release, Scream 4, arrived nearly a month after its debut in the U.S. Meanwhile, movie-goers are missing out on Kung Fu Panda 2 and the latest installment of the Pirates of the Caribbean series. Many worry about being left in the dark when Harry Potter and the Deathly Hallows: Part 2 is released in mid-July.

    You May Like

    New EU Asylum Rules Could Boost Rightists

    New regulations will seek to correct EU failures in dealing with migrant crisis, most notably inability to get member states to absorb a total of 160,000 refugees

    More Political Turmoil Likely in Iraq as Iran Waits in the Wings

    Analysts warn that Tehran, even though it may not be engineering the Sadrist protests in Baghdad, is seeking to leverage its influence on its neighbor

    Forced Anal Testing Case to Appear Before Kenya Court

    Men challenge use of anal examinations to ‘prove homosexuality’; practice accomplishes nothing except to humiliate those subjected to them, according to Human Rights Watch

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Tensions Rising Ahead of South China Sea Rulingi
    X
    May 03, 2016 5:16 PM
    As the Philippines awaits an international arbitration ruling on a challenge to China's claims to nearly all of the South China Sea, it is already becoming clear that regardless of which way the decision goes, the dispute is intensifying. VOA’s Bill Ide has more from Beijing.
    Video

    Video Tensions Rising Ahead of South China Sea Ruling

    As the Philippines awaits an international arbitration ruling on a challenge to China's claims to nearly all of the South China Sea, it is already becoming clear that regardless of which way the decision goes, the dispute is intensifying. VOA’s Bill Ide has more from Beijing.
    Video

    Video Painting Captures President Lincoln Assassination Aftermath

    A newly restored painting captures the moments following President Abraham Lincoln’s assassination in 1865. It was recently unveiled at Ford’s Theatre in Washington, where America’s 16th president was shot. It is the only known painting by an eyewitness that captures the horror of that fateful night. VOA’s Julie Taboh tells us more about the painting and what it took to restore it to its original condition.
    Video

    Video Elephant Summit Results in $5M in Pledges, Presidential Support

    Attended and supported by three African presidents, a three-day anti-poaching summit has concluded in Kenya, resulting in $5 million in pledges and a united message to the world that elephants are worth more alive than dead. The summit culminated at the Nairobi National Park with the largest ivory burn in history. VOA’s Jill Craig attended the summit and has this report about the outcomes.
    Video

    Video Displaced By War, Syrian Artist Finds Inspiration Abroad

    Saudi-born Syrian painter Mohammad Zaza is among the millions who fled their home for an uncertain future after Syria's civil war broke out. Since fleeing Syria, Zaza has lived in Lebanon, Egypt, Jordan and now Turkey where his latest exhibition, “Earth is Blue like an Orange,” opened in Istanbul. He spoke with VOA about how being displaced by the Syrian civil war has affected the country's artists.
    Video

    Video Ethiopia’s Drought Takes Toll on Children

    Ethiopia is dealing with its worst drought in decades, thanks to El Nino weather patterns. An estimated 10 million people urgently need food aid. Six million of them are children, whose development may be compromised without sufficient help, Marthe van der Wolf reports for VOA from the Metahara district.
    Video

    Video Little Havana - a Slice of Cuban Culture in Florida

    Hispanic culture permeates everything in Miami’s Little Havana area: elderly men playing dominoes as they discuss politics, cigar rollers deep at work, or Cuban exiles talking with presidential candidates at a Cuban coffee window. With the recent rapprochement between Cuba and United States, one can only expect stronger ties between South Florida and Cuba.
    Video

    Video California Republicans Weigh Presidential Choices Amid Protests

    Republican presidential candidates have been wooing local party leaders in California, a state that could be decisive in selecting the party's nominee for U.S. president. VOA's Mike O’Sullivan reports delegates to the California party convention have been evaluating choices, while front-runner Donald Trump drew hundreds of raucous protesters Friday.
    Video

    Video Kurdish Football Team Helps War-Torn City Cope

    With the conflict still raging across much of Turkey’s predominantly Kurdish southeast, between the rebel PKK and the Turkish state, many Kurds are trying to escape the turmoil by focusing on the success of their football team Amedspor in Diyarbakir. The club is increasingly becoming a symbol for Kurds, not only in Diyarbakir but beyond. Dorian Jones reports from southeast Turkey.
    Video

    Video ‘The Lights of Africa’ - Through the Eyes of 54 Artists

    An exhibition bringing together the work of 54 African artists, one from each country, is touring the continent after debuting at COP21 in Paris. Called "Lumières d'Afrique," the show centers on access to electricity and, more figuratively, ideas that enlighten. Emilie Iob reports from Abidjan, the exhibition's first stop.
    Video

    Video Florida’s Weeki Wachee ‘Mermaids’ Make a Splash

    Since 1947, ‘mermaids’ have fascinated tourists at central Florida’s Weeki Wachee Springs State Park with their fluid movements and synchronized ballet. Performing underwater has its challenges, including cold temperatures and a steady current, as VOA’s Lin Yang and Joseph Mok report.
    Video

    Video Somali, African Union Forces Face Resurgent Al-Shabab

    The Islamic State terror group claimed its first attack in Somalia earlier this week, though the claim has not been verified by forces on the ground. Meanwhile, al-Shabab militants have stepped up their attacks as Somalia prepares for elections later this year. Henry Ridgwell reports there are growing frustrations among Somalia’s Western backers over the country’s slow progress in forming its own armed forces to establish security after 25 years of chaos.
    Video

    Video Nigerians Feel Bite of Buhari Economic Policy

    Despite the global drop in the price of oil, Nigerian President Muhammadu Buhari has refused to allow the country's currency to devalue, leading to a shortage of foreign exchange. Chris Stein reports from Lagos businessmen and consumers are feeling the impact as the country deals with a severe fuel shortage.

    Special Report

    Adrift The Invisible African Diaspora