The film industry got a much needed relief when the government announced a cut in the Goods and Services Tax (GST) rates on movie tickets before 2018 came to a close. The rate cut, which came into effect on January 1, brought the taxes down from 28 percent to 18 percent on movie tickets above Rs 100 and from 18 percent to 12 percent for tickets priced Rs 100 and below. While the industry welcomed the decision to cut the GST rates, the audience is not happy as the benefits have not been passed on to them.
Talking to Moneycontrol, Sethumadhavan Napan, COO/Producer at DAR Motion Pictures, said: “There is definitely confusion prevailing in this aspect, people are not really sure as to when cinemas (single screens and multiplexes) are going to implement the same (GST rate cut). Unless there is absolute clarity on this across the country & that too very soon it’s going to add to the already existing woes of the movie going audience.” Many cinephiles also took to social media to express their dissatisfaction over no reduction in ticket prices. Experts suggest that those who have watched films on December 31 and January 1 can compare the prices of the movie tickets and can file a complaint to the anti-profiteering authority if prices have not reduced. There have also been instances when theatre owners increased the net amount on which the tax is levied and the audience did not get the benefits of GST rate cut.
Commenting on this, Napan said: “This has been a regular problem seen from time to time, especially when big ticket films release and the audience has had to bear the brunt unfortunately. I certainly hope that we do not see this happening. Exhibitor associations should ensure that this potential problem is avoided clearly as that is the right way to ensure that the new GST legislation works in the ideal way to benefit consumers (audience).” Theatres in the Telugu speaking states are reportedly not keen on passing the rate cut benefits to the audience. They claim to have not burdened the consumers when tax was hiked, so they do not want to cut the prices when the taxes are been reduced. However, in many states the new tax rates have come into effect.