The Goods and Services tax has been rolled out today.
While the “one nation, one tax” proposal might have lowered the prices of your daily household items, but movie tickets might become significantly steeper.
For the uninitiated, GST has put movie tickets under the highest tax slab – 28 per cent. In fact, watching a film in theatres is being considered a bigger luxury than having a meal at a fancy five-star restaurant (which is placed at a revised 18 per cent tax slab).
After many talks, the government did relent and lower the tax rate to 18 per cent for tickets costing below Rs 100. However, this is not much of a respite for most states since ticket prices in most multiplexes across the country are priced higher than Rs 100.
Regional films will be hit harder than Bollywood films, as they currently pay either nothing or subsidised entertainment tax. Kannada films, for instance, had been exempt from entertainment tax for nearly two decades, but now its audiences will have to bear the brunt of the GST.
While the whole of Bengali Film Industry and Tamil Film Industry stand in solidarity against the new proposed Entertainment Tax, Bollywood seems to be quite okay with it!
Big stars like Shah Rukh Khan, Amitabh Bachchan, Salman Khan have all given their nod to the new GST.
While Sr. Bachchan went on to become the brand ambassador of GST, King Khan said, “Notwithstanding my limited knowledge of financial stuff, the #GSTBill is an awesome advancement for our country’s potential. Congrats to us.”
Salman Khan also is in full support of the 28 percent tax slab for cinema under GST. Dabangg Khan said, “Whatever the government has done, they must have done it with proper planning”
Speaking in solidarity, Parineeti Chopra said, “We have to follow the government’s rules and regulations.”
Tiger Shroff spoke about the same saying, “What has to be done has to be done. However, it’s not the greatest thing right now for buying tickets or for people who want to watch our films, or go for a movie. But if they (viewers) are enticed by the promos or are fans of the artist, they will just watch the film any how.”
But while most of the actors seemed to be okay with it, B-Town producers don’t seem to be much in favour of the tax.
Mukesh Bhatt feels with the implementation of the new rates, the government is turning the entertainment industry into a gambling industry. “They have to understand that we are a creative industry, we are different from gambling and tobacco industries. Why are we treated like the paan and gutkha industry? Are we injurious to health?” said the Aashiqui 2 producer.
Siddharth Roy Kapur, president of the Film and Television Producers Guild of India, was very vocal about his dismay over GST. “The industry had proposed a rate of 5% in our representations to the government, in order to revive a business that has been struggling with the lack of fresh investments in new cinema screens and a significant increase in online piracy. The average entertainment tax collected nationally by the government across all states and languages was in the range of 8-10% of gross box office revenue. Hence logically the GST rate should not have been more than 12%, in order to avoid any exchequer loss. Instead, the government has equated the film sector with the gambling and betting industries and taxed it at the highest slab of 28 per cent,” he said in an official statement.
Thus, while it is very clear that Bollywood is divided when it comes to supporting the GST, we have to wait and see how much good or bad the tax does!