The cultural networks of the show are asking the Government to evaluate the collection of VAT in the cultural sector

The cultural networks of the show have asked the Government to evaluate the collection of VAT to the cultural sector.

“After 3 hard years of intermittent work, job abandonment, social crisis, prolonged closures, reduced capacity, pandemic, theater audience crisis and economic crisis, it is not possible for theatres, which do not have stable funding or have competitive resources that will not be readjusted, can allocate more resources to artistic programming and related expenses”, declares Karla Sandoval, president of the Red de Salas de Santiago in a letter sent to the President of the Republic Gabriel Boric, and to the Ministry of Culture and Finance .

The letter, in turn, details relevant points such as: that the provision inherited from the previous Government does not go hand in hand with the Dignified Cultural Work agenda proposed by this Government and by the Ministry of Cultural Heritage and Activities, which could cause a disincentive for the formalization of entities into companies or legal entities, with or without profit, in order not to reduce their liquidity due to VAT payments.

Concern has also been written about the increase in job precariousness of cultural operators, the speed differences in the modes of production with respect to industries and other market sectors, the slow recovery and billing of spaces that make it difficult to approve of bank credits, among other points.

“Cultural operators are experiencing critical moments. From the Foundation/Association of Performing Arts Companies (Acaes), which brings together six Chilean companies with permanent casts: Tryo Teatro Banda, Teatro de Ocasión, La Llave Maestra, Viajeimmóvil, Silencio Blanco and Los Fi, we look with concern at the entry into force of the Law 21.240, since it directly affects the scarce resources with which we carry out our annual artistic work”, says Carolina González, president of Acaes.

For entertainment companies that have incorporated themselves, prompted by the cultural policies of the State, it is normal to issue invoices without VAT, for benefits with schools, theatres, festivals, foundations, entities, the State itself, among other institutions.

“Being able to carry out our services exempt from VAT allows us to lower the cost of selling the functions, which has a direct impact on those who buy them from us”, explains Carolina.

“From the Red de Festivales de Artes Escénicas de Chile AG, we deeply regret the incorporation of VAT in cultural activities, since this law does not only harm civil society organizations, which represent a fundamental pillar in the cultural ecosystem of our country. I its side effects will be intrinsically felt by the arts sector, one of the sectors most affected by the COVID-19 crisis and one of the most precarious within the current work system”, says Claudio Fuentes, president of the Festival Network.

“We deem it necessary and urgent to include cultural associations in the VAT-exempt tax codes and start coordinated work with the institution so that culture, the arts and heritage have the place they deserve in the country’s production chain”, points out Claudio Fuentes.

“We make an urgent appeal to the President of the Republic Gabriel Boric and to the Minister of Finance Mario Marcel so that we can have an answer to our concern about this imposition of VAT on cultural services”, he concludes.

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