Daily Management Review

Pay For Chinese Film Stars Capped By Regulatory Authorities


06/28/2018




Chinese authorities have blamed its entertainment industry for fostering “money worship” and “distorting social values” and have set a cap on the salaries for celebrities.
 
A joint notice from China’s five government agencies which include its tax authority, the television and film regulator, and the propaganda department has stated that 40 per cent of the total production costs should be the maximum that can be the salary of on-screen performers. The announcement that was published in Xinhua, no more than 70 per cent of total wages for the cast can be given to leading actors.
 
In recent times, there have been a number of incidents where Chinese celebrities have been accused of signing fake contracts to evade taxes and this directive follows those incidents. The directives are similar to the guidelines that were released by the China Alliance of Radio Film and Television last year.
 
Photos of contracts that are believed to be of Fan Bingbing, who is amongst the highest paid actors in China, were posted by a well-connected Chinese TV presenter, Cui Yongyuan in May. Those two contracts which were valued at $1.56m and $7.8m were reportedly an example of the so called “yin-yang contracts” which is a common way for evasion of taxes where reporting of only the smaller contract is made to tax authorities.
 
While Cui has put accusations on other celebrities of indulging in the same behavior, any wrongdoing was denied by Fan. Tax evasions were being examined by tax authorities of “certain film and television professionals as alleged in online discussions”, authorities in Jiangsu province, the place where Fan operates a film studio, have said last month.
 
The use of yin-yang contracts was criticized on Wednesday’s directive. The directive said that such contracts not only has a damaging impact on the quality of China’s film industry but also is a source of encouragement for the couth of the country to “blindly chase stars”.  Social benefits should be put at the foremost, the notice said.
 “Box office ratings and click-through rates should be firmly opposed”, read the notice.
 
Attempts to reign in the entertainment industry – the online content specifically, is being undertaken by the Chinese regulators. The exorbitant salaries of the country’s stars have also drawn criticisms of many citizens and many would therefore support he directives.
 
“Society has given them too much and look at what they give back,” one Weibo user wrote in response to news of the salary caps. On the other hand, while being supportive, others were skeptical of any real change: “Thunder sounds loud while the raindrops are small. Other departments have made such announcements before.”
 
Such a debate is not being encouraged by Chinese propaganda authorities. Earlier this month, it issued a directive to Chinese news organisations which said: “Content related to tax issues involving people in the film and television industry and ‘yin-yang contracts’ should be held back.”
 
(Source:www.theguardian.com)






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