New funding sources for culture by Ministerio de Cultura , Colombia
The Ministry of Culture has prompted new forms of financing for the sector, ranging from soft loans to entrepreneurs, to increase the percentage that corresponds to the culture in the General System of Participation. The resources of the national government for the cultural sector have increased by 92% over the previous four years. This is related to the total number of resources, including both direct investment and transfers from the Ministry to the departments.
The Ministry of Culture moved from a budget of 654 billion pesos-resources allocated during the previous period of government-to have an investment of 1.2 billion pesos in the period between 2011 and 2014.
This increase is due, among other reasons, the increase in the percentage with a specific destination in the General System of Participation, the benefits of the Mobile Phone Consumption Tax which are destined for the protection of cultural heritage and the National Network of Public Libraries resources, never-seen before support from Enterprise Fund and Bancóldex to cultural entrepreneurs, the adoption of Public Shows and Filming laws and the resources managed with other government entities and international cooperation.
“We are dedicated to present structural laws for more resources for the sector. We set clear goals, build impact indicators, quantitative and qualitative, and work in the poorest municipalities and that has been very significant for the Ministry of Finance, allowing us to allocate more resources. We stress, for example, the tax reform so that money for public libraries is guaranteed; this will represent the Ministry about $ 25,000 million per year by increasing the tax on mobile telephony, “said the Minister of Culture, Mariana Garcés Córdoba.
A pulse to the resources of the General System of Participation (SGP)
When the law 714 of 2001 was amended this decreased the basis of the general purpose of the GSP – resources that the federal government transfers to all municipalities in the country, from 17% to 11.6%. This modification significantly affected the resources for culture, as the sector continued to have the same 3% of the budget that initially had, but in a much smaller bag of resources.
“To level this reduction, the Ministry of Culture presented to the Congress a proposal to double the percentage of those resources earmarked for culture, which means that the sector now accounts for 6% of the overall GSP, “says José Ignacio Argote, Head of Planning at the Ministry of Culture.
Although this achievement is significant, there is still much to do. “Our idea is to remove the earmarking resources for the culture of the category of general purpose and place it as a specific share for the sector that has 4% of the total resources that rotates the General System of Units to all municipalities, which would mean resources for about 1.2 billion dollars a year, “he says.
More investment for projects related to Cultural Heritage
One of the most important sources of financing of culture in the regions comes from the mobile phone consumption tax – reviously VAT on mobile phone -. Colombians pay the 4% excise tax on the use of cellular service which is intended to fund sport and culture in the following percentages: 10% for the National Network of Public Libraries and the remaining 90%, 87.5% sports and 12.5% to support projects related to the protection, maintenance and dissemination of cultural heritage.
Previously, when these resources were not used by the departments, they were to be reinstated to the national treasury and therefore the culture sector failed to perceive them. The great achievement in this governmental period has been to include and identify in the Development Plan that these resources are incorporated into the investment budget of the Ministry of Culture to be executed directly.
New support for cultural industries
Other new sources of funding to support cultural entrepreneurs in the country is managed through the Enterprise Fund and Bancóldex, entities that had never before supported projects in the cultural sector.
From 2011 to 2014 the Fund allocated five billion dollars to support the development of cultural industries with seed capital grants. “We had to train the jurors to understand the particularity of cultural industries. A case in point was that of an urban artist who does murals that do not cost more than $ 500,000 to make but can be charged at about $ 5,000,000, which is not consistent with the common logic of the economy, “said the Head of Planning of the Ministry of Culture.
For Bancóldex, in the same time period, four billion pesos were spent in soft loans to micro and small cultural enterprises.
New Laws to encourage cultural production
The Ministry of Culture also presented in the Congress two fundamental laws to strengthen the cultural sector: the law of public shows and the filming law in Colombia.
The former was created to encourage, formalize, democratize and make competitive the performing arts sector in Colombia and after with introduction they law the sector has managed to raise $ 28,171 million to be allocated for the construction, maintenance and / or recovery scenarios for public entertainment.
“This law allowed to lower the tax costs to foreign artists’ fees from 33% to 8%. This allowed artists like Paul McCartney, Beyonce, Madonna, Lady Gaga or Metallica to come to Colombia. Through the box office sale of more than about $ 86,000, the Ministry makes a cess collection of 10% that is returned to the municipality to improve its cultural venues and infrastructure scenarios, “concluded the Minister Garcés.
With the enactment and implementation of Colombia filming law, which promotes filmmaking in the country, the Film Fund Colombia (FFC), was created that to date has managed to obtain resources for $ 35,148,000
The generation of these new sources of financing demonstrates the confidence of different government agencies, the private sector and international cooperation in the development and consolidation of the Colombian cultural sector, whose industries account for 3.3% of GDP the country.