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A TAXING NEW YEAR

Chinese impose 3% 'fee' on ent. industry

BEIJING — The Chinese entertainment industry will bring in the New Year with a whimper.

As if the industry doesn’t have enough problems, the State Council, or cabinet, has decided to levy what it is politely referring to as a “cultural undertakings construction fee” starting Jan. 1, 1997.

Translation: We are introducing new taxes and there’s nothing you can do about it.

Dance clubs, karaoke bars, live music venues, golf courses, bowling alleys, pool halls and other entertainment locations will be required to turn over 3% of their total business revenue to the new fund.

Radio and TV stations, newspapers and other publications, advertising agencies and other media concerns that accept advertising will be required to turn over the same amount of their earnings.

Fees will be collected by the tax authorities, and proceeds placed in central- and provincial-level funds.

A small income tax deduction will also be awarded to any individuals or companies donating to the fund.

The donations must be made through government agencies or approved nonprofit public service groups, and must be for designated orchestras, ballets, Peking Opera troupes or other national art forms, as well as for public libraries, museums, galleries, revolutionary memorials and the preservation of cultural relics.

The money will be divided into four different funds: Cultural Propaganda Development Fund, Outstanding Program Creation & Performance Development Fund, State Film Development Fund and Publication Development Fund.

Criteria for receiving support from the state-controlled funds are still being worked out, but normally such funds go to projects that are seen by the government as upholding socialist values, promoting Chinese traditional culture and providing public service.

The Chinese entertainment and media industries have been battered in the past year by a government campaign to reassert stricter controls. The film and music industries, for example, are severely depressed. Television and radio are faring better, but are also facing stiffer regulation.

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