New Delhi: Very soon you could watch more, pay less. If Information and Broadcasting Minister Priyaranjan Dasmunsi succeeds in persuading states to reduce entertainment tax on films, watching movies could be a much ‘lighter’ experience.
Dasmunsi will be meeting information ministers from all states on Wednesday in the Capital to try and convince that entertainment tax on the films should be minimised for a better growth in Indian cinema, ministry sources said.
Depending on the location of theatre in the states, the movie-goers pay anywhere between 40 to 100 per cent tax on a ticket, making India one of the most highly-taxed in the entertainment sector, in the world.
This is in contrast with other industries where excise duty is capped at 16 per cent and service tax at 15 per cent.
Average entertainment tax rates in the neighbourhood are between 10 and 15 per cent.
As entertainment tax is the state subject under the Constitution, every state has its own tax regime.
The film industry has often complained of multiplicity, unrationalised and obsolete tax structure, which has been subject to the whims of each state government.
Besides a hefty entertainment tax, which nearly doubles the cost of the ticket, the film industry also coughs up 12.5 sales tax or VAT (value added tax) on the eatable and drinks sold in the intermission, 12.36 service tax on the advertising revenues, 12.5 VAT on the distributor payouts, 12.36 service tax on the property rentals.
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