Chinese film authorities are exploring the possibility of returning their 5 percent cut of box office revenues to theaters that show more domestic films.

The move is to help Chinese film companies that will face stiffer competition from Hollywood movies as the annual quota for foreign films to China increases from 20 to 34.

The Chinese government collects 5 percent of revenues from local theaters for the National Film Development Fund, which channels the money to support rural film screening, children's films and patriotic films.

The State Administration of Radio, Film and TV recently invited directors, scholars and insiders from production, distribution and exhibition businesses to discuss the feasibility of the new proposal to return part or all of the tax.

Zhang Hongsen, deputy director of the State Film Bureau, confirmed the proposal but emphasized that it is still in the planning stage.

Wang Hongwei, deputy dean of the Beijing Film Academy's directing department, hails the proposal but reminds domestic filmmakers of the importance of quality.

Confronted with Hollywood blockbusters such as The Avengers and Titanic, local films have gone through a hard time over the past two months.

According to EntGroup, a leading research center on the Chinese entertainment industry, domestic films sold only 180 million yuan ($28 million) of tickets in April, while foreign films, the majority of them Hollywood movies, sold 1.4 billion yuan.

The quota of Hollywood movies getting into China was increased following an agreement during Vice-President Xi Jinping's visit to the United States earlier this year. The new deal caused some anxiety among Chinese filmmakers.