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Promoters will now have to fork out 'big bucks' to obtain international artistes and services, dealing the entertainment industry a heavy blow. The revised tax measures were announced by Finance Minister Audley Shaw as he closed the 2009/2010 Budget Debate in Gordon House on Wednesday. This means that promoters will now be paying an additional 16.5 per cent GCT to bring in overseas artistes.
The new tax measure is part of a package announced by the finance minister to raise $18 billion to help finance the $555.7-billion budget. The new measures mean that popular shows such as Jamaica Jazz and Blues Festival, Reggae Sumfest, International Comedy Fest, Fully Loaded, Carnival, and other shows that often bring acts outside of Jamaica will be forced to pay more for the acts, which may result in a rise in the entry fee.
Shaw stated during the debate that imported services is an area that was identified by the Government in 2003 and was placed in the GCT but not enforced.
When contacted, chairman of the Taxation Committee of the Institute of Chartered Accountants, Ethlyn Norton-Coke, explained, "You have GCT on bringing in foreign acts now, the promoter has to add 16.5 per cent to whatever the entertainer charges that is coming from abroad, 'cause it's an imported service. Everything is going to be caught."
Jamaica Jazz and Blues has long had persons flocking to the show every year with a billing of mainly foreign artistes. Known as an expensive event, it is one, however, that brings in a large number of tourists in a non-tourist season. Jazz and Blues promoter Walter Elmore told THE WEEKEND STAR that they have to take a long look over the next few weeks at what will have to be done with the new tax measures.
He said, "Artistes cost quite a bit and we have to find a way to adjust to it, because it's going to be hard to raise the prices ... it<span style="font-weight: bold"> will impact heavily on what we (the promoter) pay, because sometimes it's not just the artistes, but a company that we get them through - will this mean we have to pay for the whole company? The artiste's band, the light engineers, sound people. It's going to be a challenge."</span>
He continued, "I understand that the Government needs to raise revenues, but this is an event that is in the arsenal of the Jamaica Tourist Board, to market Jamaica as well as something like Sumfest."
Elmore believes the Government needs to take a long look at the implications for the entertainment industry.
Stage shows aren't the only ones that will be bearing the burden. Stand up comedy, which has increased in popularity, also brings in overseas comedians each year.
Owen 'Blakka' Ellis of Ellis International, organisers of the International Comedy Fest, believes if additional taxes and increased costs are faced by promoters, then the cost for entry will have to rise as well.
He said, "These new tax measures just mean we will have to do more of what we are called upon to do: apply innovation and creativity to try stay afloat and improve earnings. The tax increases are, to me, just a part of a general climate of change and challenge and we resolutely refuse to lie down and bawl. We shall find ways around, over, and through the obstacles, and we shall do it without loss of humour. A potential positive from this is greater reliance on local talent and expertise in the entertainment services."
He added, "The harder life gets, the greater the need for release and relief. So comedians should see the economic austerity as comedic opportunity. Prices rising, we'll just have to raise the decibel level on the laughter."
As promoters worry over the new taxes, patrons might now face higher prices for shows or miss the opportunity to see their favourite acts.
Susan, a lover of foreign acts, expressed, "I think that this is gonna reduce the chance of seeing certain acts come to the island, because the promoter won't be able to afford them and, if they do, then the cost of tickets gonna go up and some of us just cannot afford that right now."
Already the number of shows boasting overseas acts has lessened, as seen over the Mother's Day weekend, which usually features shows with international artistes that were geared towards mothers.
*Name changed upon request