NEWSFLASH 

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MOVIE, RADIO-TV STARS GET 1-YEAR VAT REPRIEVE

Manila, Feb. 17, 2000 - President Joseph "Erap" Ejercito Estrada signed into law Wednesday Republic Act 8761 deferring by one year the imposition of Value Added Tax (VAT) on actors, actresses, talents, singers and emcees; radio and television broadcasters, choreographers; musical, radio, movie, television and stage directors; and professional athletes.

Under RA 8761, the imposition of VAT would take effect on Jan. 1, 2001.

Also covered by it are: services rendered by banks, non-bank financial intermediaries, finance companies, and other financial intermediaries not performing quasi-banking functions; and services rendered by stock, real estate, commercial, customs and immigration brokers.

The President said he expects the reprieve to boost the economy as it is not timely to impose VAT on services when business is just starting to pick up at this time.

"I believe that the imposition of the VAT on financial institutions at this delicate time would cause further delay in our full economic recovery. The new law will give the financial sector a one-year reprieve from VAT and give sufficient time to revisit the applicability of this tax on the sector," he said.

He added the one-year deferment would allow the Executive Department, Congress and the private sector to agree on a meaningful tax reform program for the financial sector. The deferment would also allow the Bureau of Internal Revenue (BIR) to fully computerize its revenue administration.

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