TN theatres on indefinite strike over 30% entertainment tax even after GST

Business Standard By T E Narasimhan July 3, 2017. 12:38 IST

The producers' council also opposed to the 30 per cent entertainment tax

Theatre owners across Tamil Nadu have started an indefinite strike against the imposition of 30 per cent entertainment tax in addition to the 28 per cent Goods and Services Tax (GST) on film trade by the state government.

Abirami Ramanathan, the president of Tamil Nadu Cinema Theatre Owners Federation on Sunday evening announced that cinema hall owners would proceed with the strike in support of affected producers of recently released films.

"We have heard the pleas of the affected producers," Ramanathan said. "We will discuss what needs to be done."

A government order was passed on Friday, declaring that in addition to GST, the state will levy 30 per cent entertainment tax, which will be collected by local bodies, said Ramanathan.

The producers' council also opposed to the 30 per cent entertainment tax.

Ramamnathan pointed out that the local body tax of 30 per cent was in addition to the GST tax rate of 28 per cent for tickets that cost over Rs 100 and 18 per cent for tickets priced less than Rs. 100. He said an additional levy of about eight per cent under GST would push total taxes to over 60 per cent.

Totally, it adds up to 68 per cent, leaving theatre owners with just 32 per cent, said Ramanathan. He also claimed that many of the theatre owners have shut their business on Sunday since they felt it would not be viable to pay such a huge percentage towards tax.

The Federation asked the state government to remove the local body tax of 30 per cent, which would also automatically take away the additional eight per cent that is levied under GST.

Ramanathan said they have asked the state government to fix a threshold below which they should be allowed to increase ticket prices or cut them as needed.

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