GST Bomb on Film Industry

The proposed Goods and Services Tax (GST) is going to adversely affect the film industry. The proposed Tax regime will deal a deadly blow to the industry which is already not doing well. Currently, there is no entertainment tax on local language films in Tamil Nadu and Karnataka, both states will now have to impose GST which may come up to more than 20%.

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Andhra Pradesh and Telangana have an entertainment tax of seven percent for small films and 14 per cent for big films. GST will further increase the tax burden. Moreover, both the Telugu states do not have the tax in film theaters located in Panchayat areas but now theaters in villages will also have to start paying GST.

South Indian film chamber of commerce is planning to send a representation to Union Finance Minister, Arun Jaitley to exempt Film Industry from GST regime. In case, the central government does not agree to exempt, the industry may have to consider pushing the burden on to the audience which will make film tickets costlier. However, Bollywood and Hollywood films will stand to gain due to GST as in most states, the entertainment tax on non-local films is high.