Tamil Nadu cinema owners, film distributors join strike against local body tax; ticket prices to rise

FP Staff

Oct,07 2017 17:14 29 IST

As the strike against the Local Body Entertainment Tax continues in Tamil Nadu, it is being reported that cinema hall owners and film distributors have joined the strike initiated by the Tamil Film Producers Council. Apart from the damage it has caused with respect to stopping the release of new films and box office collections, it seems that the impact will also be felt by consumers now, due to a considerable rise in the prices of movie tickets.

Image for representational purposes only. Image from Reuters.

Representational image. Image from Reuters

Notably, Tamil Nadu is the only state in India which has called for the implementation of the Local Body Entertainment Tax. In addition to the Goods and Services Tax levied on movie tickets, patrons also have to pay 10 percent entertainment tax for Tamil films and 20 percent for films made in other languages.

The rise in ticket price is quite steep. For tickets of films which are priced under Rs 100, patrons will pay 18 percent as GST. But for those films whose tickets cost more than Rs 100, 28 percent GST is applicable. With the implementation of the Local Body Entertainment Tax, a cine-goer who wishes to watch a non-Tamil film priced over Rs 100 will end up paying 48 percent tax.

"In the last fiscal year, theatre owners paid the state government Rs. 85 crore as entertainment tax. Now that the GST is implemented, the state government will collect Rs 170 crore in form of tax from us. There is no need to implement this entertainment tax as this sector is already generating revenue for the state government," M Subramaniam, president of the West Zone Theatre Owners’ Association, said to Deccan Chronicle. He also mentioned that the strike is costing the film industry Rs 10 crore per day.