BUSAN – Taiwan may impose a 5% tax on all cinema tickets sold in the island territory. The proceeds will be channeled into a fund to help support the local movie industry.

The proposal was put forward Wednesday by the Ministry of Culture at a meeting with local film-makers and industry bodies. The ministry positioned the move as an amendment to the existing Motion Picture Act.

It said that the tax would be levied on ticket sales for all films, domestic and foreign. The support fund would provide subsidies for Taiwanese film-makers and screenwriters, and encourage them to make more films.

Domestic market share for local titles this year stands at 17%. That is considerably lower than the 60% currently enjoyed by some Asian neighbors; Korean films in South Korea and the more than 50% enjoyed by Chinese films in China. But it is higher than the scores for local films in Singapore or Australia.

Cinema operators said that the tax would have to be passed on to customers and would lead to an increase in ticket prices, something many operators have avoided for several years for fear of deterring audiences.

Countries elsewhere also have ticket or entertainment taxes. Some funnel the tax revenue into central government coffers and while others keeping the proceeds apart and recycle them back into the local film industry. For decades France has operated an 11% tax which feeds back into local film through the Centre national de la Cinematographie et de l’Image Animee.

Taiwan has rarely operated a consistent policy line towards its film industry. Coinciding with a revival in commercial cinema, the central government offered prizes and other incentives in the late 2000s. But in some cases the funds were unexpectedly exhausted and in others they have been reduced or halted. The island’s iconic director Hou Hsiao-hsien waited for years before sufficient government funds were available for him to begin shooting of his big budget “Assassins.” Now it has reportedly halted.

Responsibility for film in the island last year passed from the Government Information Office (GIO), a regulator and mouthpiece for the regime, to the Ministry of Culture which set up a new Bureau of Audiovisual and Music Industry Development (BAMID).

In Busan earlier this week Taiwan held a well-attended party to celebrate its half dozen films selected for different sections of the South Korean festival. Film-makers in attendance included Taiwan-based Tsai Ming-liang, China’s Jia Zhangke and Hong Kong’s Tsui Hark.

Earlier this week it emerged that, in a separate administrative reshuffle, the Taipei Film Commission is to be replaced by a new Taipei Film Council. The new body, to be headed by existing TFC head Jennifer Jao, will launch on Oct. 29. The new Taipei Film Council is also expected to absorb responsibility for running the Taipei Film Festival, which is held annually in June.