Lack of clarity on ticket prices after the implementation of the Goods and Services Tax has led the to an indefinite shutdown of theatres across Tamil Nadu from Monday, IANS reported. As per the new tax regime, which came into effect Friday midnight, cinema tickets above Rs 100 will fall under the 28% tax slab. However, according to a recent ordinance passed by the Tamil Nadu government, theatre owners have to pay 30% entertainment tax to the local body.
The Tamil Nadu government has yet not specified if the entertainment tax would be levied over and above the GST rate. “We request the state government to clarify by this weekend as to how much tax amount will be levied on theatre owners,” said President of Tamil Nadu Theatre Owners and Distributors Association Abhirami Ramanathan.
According to Ramanathan, the 30% tax is “in addition to the GST rates and on each local body tax, we have to pay an additional 8% GST”. “So the total tax rate is 66% in Tamil Nadu…which is unviable,” he told The Hindu.
Over 10 lakh families associated with the film industry in the state will be affected. “About 800 theatres are part of the association and we will all be shut from Monday till the local body does not take back this government order,” Panneerselvam, General Secretary of Tamil Nadu Theatre Association, told The News Minute.
Kerala and Telangana government had withdrawn the local body taxes. Theatre associations demanded that the Tamil Nadu government did the same. “It is going to be the biggest burden for the entire Tamil film industry. What has been nourished by MGR, Jayalalithaa and Karunanidhi is all set to collapse because of the new tax regime,” L Suresh, president of South Indian Film Chamber of Commerce told CNN News18.
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