BENGALURU: Kannada movies are set to take a beating as movie tickets will attract 18 per cent GST. So far, no tax was levied on Kannada movie tickets.
With GST, at theatres charging less than `100 for a ticket, there will be 18 per cent tax while tickets costing more will attract 28 per cent tax. Karnataka Film Chamber of Commerce president Sa Ra Govindu cried foul and said the new tax regime will make it impossible for the industry to survive. “Prime Minister Narendra Modi seems to have kept in mind only those from North India. Not just Kannada, all South Indian movies are set to take a beating,” he added.
Govindu said that other language movies will be priced less now. “Previously, the tax levied was 32 per cent. Now it is only 18 per cent. This means a great drop in the rates,” he said.
Rajaram M R, owner of Gayathri Theatre explained that for a movie ticket costing less than `99.99, tax of 18 per cent will be levied. “This will be the case in most single-screen theatres while multiplexes will charge 28 per cent since tickets cost more than `100. In case the ticket is prices at `97.99, `3 is added as maintenance charge. Even this will be taxable under GST,” he said.
“Movie tickets have been taxed at the highest marginal rate of 28 per cent. Presently food and beverages at cinemas attract an incidence of 10 per cent tax. This will climb to around 18 per cent,” said Nitin Sood, CFO, PVR Cinemas.
State to reimburse
“Thankfully, the state has assured us that they will reimburse the State GST component. This means that out of the 18 per cent GST, state will give the film makers a per cent while they will have to shell out the other 9 per cent (central GST share) out of their pockets,” Sa Ra Govindu said. However, customers will not get any discount.
Multiplex Association of India, represented by Economic Law Practice, said additional taxes besides GST could be levied. Ranjeet Mahtani, partner, Economic Law Practice said civic bodies have been authorised to add entertainment taxes besides GST.