Moviegoers were thrilled on Thursday when Tourism Minister Jero Wacik announced the long-running dispute over imported film royalties could be over by next week.
However, the Finance Ministry was quick to play down expectations that Hollywood blockbusters would soon return to Indonesian big screens.
The minister said the dispute with foreign film producers and the government had been settled at last and that the Finance Ministry would issue a decree next week.
“If the decree is issued, all Hollywood movies will play in our theaters again. Our aim is for movie theaters to be swarmed by people again,” he said, adding that Hollywood film reels were already in the country and just waiting to be released.
The dispute, which led to a boycott of Indonesia by members of the Motion Pictures Association on Feb. 17, centers on Indonesia’s new system of calculating and charging royalties on imported films, which the MPA said had “a detrimental impact on the cost of bringing a film into Indonesia.”
Jero said the tax for domestic movies would be lowered to support the local film industry, and that subsidies would be given to heroic films that help build the nation’s character.
“In Indonesia, film is considered an infant industry that needs to be protected, and so the tax imposed on it should not be similar to others,” he said.
He gave little detail on what the decree would state with regard to the royalty issue, with Jero saying only that a specific tax had been agreed to by all parties concerned.
When the Finance Ministry was asked about it, the response was not as positive.
Deputy Finance Minister Anny Ratnawati said there would be a new scheme for film taxes, but it was still being discussed.
“What we aim for is to improve the scheme in accordance with best practices implemented internationally,” she said, declining to elaborate.
Anny also reiterated that two of three major film importers with back taxes had yet to pay. “Only one importer [which has paid] can play their movies here, but not the two others,” she said.
Ukus Kuswara, the director general for culture, arts and film at the Tourism Ministry, declined to elaborate on Jero’s statement, only saying that there would be a news conference next week to explain the issue. “It could be good news,” he said.
The statements from the officials were generally in line with how the issue had played out in the past four months, with the Finance Ministry being more resolute about implementing the new royalty computation and the Tourism Ministry maintaining that the government was open to negotiations.
The boycott, according to Djonny Sjafruddin, the head of the Indonesian Cinema Companies Union (GPBSI), has already led to about a 60 percent drop in cinemas’ revenue.
Cinemas have tried to meet the Indonesian demand for foreign films with either old or second-class films, but theaters have remained empty as moviegoers opted to buy pirated DVDs instead or fly to Singapore for weekend movie trips.
Djonny said on Thursday that it was about time the government realized that MPA productions were important to Indonesian moviegoers.
“That is the reality that cannot be denied,” he said.