Chennai, July 1: The Tamil Nadu Film Chamber of Commerce on Friday announced an indefinite shutdown of theatres across Tamil Nadu from July 3 due to lack of clarity on the tax amount that will be levied after implementation of GST.
The Goods and Services Tax (GST), India’s biggest tax reform since Independence has finally rolled out past midnight Friday.
The theatre owners decided to cancel all shows from July 3 after the Edappadi Palaniswami government worked around the GST and introduced a 30 per cent municipal tax on cinemas. This would be in addition to the 28 per cent tax levied under GST for tickets that cost over Rs. 100. According to the tax rates decided by the GST Council, cinema tickets priced less than Rs. 100 were to be charged 18 per cent tax.
“The state government should clear the confusion (on how much tax amount theatre owners will be charged) over the weekend. From Monday, all shows across theatres in the state will be suspended,” Abirami Ramanathan, President of the Tamil Nadu Film Chamber of Commerce, told IANS
Multiplexes in the city are yet to open bookings for weekend movies as they are unsure if the government would levy entertainment tax over GST.
“If entertainment tax is added on top of GST, we will be forced to pay 53 per cent of the ticket rate as tax to the government. It won’t be feasible for us as it will affect the livelihood of over 10 lakh families associated with the industry,” he said.
The government has announced a GST tax rate for movie tickets under two categories: 18% for tickets costing less than 100 and 28% for tickets priced over 100.
However, multiplexes would have to charge 20% lesser than the maximum ticket price for seats in the first 2 rows from the screen. Further, the film development corporation will fix the online charges. The entertainment tax (ET) in Telangana is 20%.