June 21, 2011 / 6:54 AM / 6 years ago

Indonesia movie-goers hope for end to film drought

<p>A woman stands in front of a street with posters of Indonesian films in Jakarta June 21, 2011.Beawiharta</p>

JAKARTA (Reuters Life!) - Indonesian cinema-goers thirsty for first-run foreign films hope the government has moved a step closer to settling a tax battle with importers that has kept most Hollywood blockbusters out of the country for the past few months.

Earlier this year, the government said it would push film importers to pay higher customs duties on imported films and force them to shell out more than a decade's worth of unpaid royalties -- over $30 million.

Indonesia's predominant Hollywood film importer promptly retaliated by restricting the number of films it would bring in, limiting access to all but a handful of foreign movies.

As a result, Indonesian cinema-goers have been condemned to a strange combination of second-tier Hollywood movies that have been dug up from the vaults, or avoided the ban, plus low budget Chinese martial arts flicks and domestic horror films that combine ghosts with erotic scenes -- to viewer dissatisfaction.

"Some movies deserve to be enjoyed at the cinema...so I hope the government and film importers can sort this out soon," said Johannes Prayudhi, a 31-year-old accountant.

"The holiday season has started and we are waiting for Harry Potter and Transformers."

But, in an encouraging sign for thousands of cinema aficionados, Finance Minister Agus Martowardojo said Monday that the tax system would be simplified so no royalty payments would be made.

Previously, there was a set import duty per film as well as royalty payments per viewing. The new regulations have no royalty payment but higher import duties, which would let the country turn booming consumer demand in Southeast Asia's biggest economy to its advantage.

<p>People walk in fron of posters of Indonesian films in Jakarta June 21, 2011.Beawiharta</p>

"By changing this import duty system, we hope that imported films can return again," he added.

A spokesman for the21 Cineplex cinema chain, owned by Hollywood film importerSubentra Group, declined to comment on whether it would resume Hollywood imports following the new regulations.

<p>A street vendor walks in front of a street with posters of Indonesian films in Jakarta June 21, 2011.Beawiharta</p>

The dearth of blockbuster films has driven movie fans to various measures, with sales of pirated DVDs booming at street stalls throughout the archipelago.

At the other extreme, Prayudhi said he paid nearly $100 to fly to Kuala Lumpur and Singapore with his friends to see a marathon of blockbusters that included Thor, Kung Fu Panda 2, and the newest Pirates of the Caribbean movie.

Even elected officials said they hoped the blockbuster drought could be approaching its end.

Vera Febyanthy, a member of parliament and the finance committee, said she thought the proposal was a win-win solution.

"I'm a movie maniac but I haven't seen one in three months...I watch DVDs now," said Febyanthy, from the ruling Democrat Party.

"As a politician, I need films to relieve stress."

Reporting by Olivia Rondonuwu and Aditya Suharmoko; Writing by Neil Chatterjee; editing by Elaine Lies

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