THIRUVANANTHAPURAM: Had the City Corporation hosted the International Cricket match 18 months ago, it would have been richer by almost Rs 80 lakh. That’s the amount the Corporation could have raked in as entertainment tax. For the local body that shows no hesitation to open up fresh revenue channels to meet the rising expenses, that moolah could have been a godsend. However, the Central Government’s decision to roll out GST came as a body blow as the civic body and officials now rue they have missed a ‘gold mine’.
The price of tickets of the one-day match has become costlier as 28 per cent GST has been imposed as per the Central Government regulation. The Kerala Cricket Association (KCA) has collected a total amount of Rs 3.84 crore by selling around 39,000 tickets during the one-day match organised at the Green Field Stadium on November 1.
On implementing the GST, the local bodies were directed not to collect entertainment tax. Their loss in that score would be compensated by the government. The government has made mandatory fiscal devolution to local bodies based on the amendment for the income loss incurred by the local bodies.
“Earlier, the Corporation had imposed 20 per cent entertainment tax on conducting a sports event. If entertainment tax still existed, the local body could have gained almost Rs 80 lakh. Now, with the implementation of GST, the government pays us a compensation based on the average amount collected three years before the implementation of GST with an increase of 15 per cent, said a Corporation revenue officer.
The Corporation used to make a good amount in the name of entertainment tax. The local bodies in the state levied 25 per cent entertainment tax on cinema tickets. Even though many new theatres have been added to the city, still the Corporation is getting the compensation based on the earlier calculated average amount, said the officer.
“The scrapping of entertainment tax with the implementation of GST has incurred a huge loss in the Corporation’s revenue. Before the introduction of GST, we even earned an amount of around Rs 12 crore as entertainment tax which includes tax from events and cinema theatres.