GST Impact: Over 1,000 TN Theatres on Indefinite Strike From Today

Theatre owners in Tamil Nadu have to shell out up to 58% tax on movie tickets that cost above Rs 100.

Sathyam Cinemas in Chennai. Photo used for representational purpose.

(Photo Courtesy: Sathyam Cinemas)

As many as 1,100 theatres across Tamil Nadu will remain shut on Monday after the owners called for an indefinite strike to protest the state’s imposition of a 30% entertainment tax in addition to the 28% Goods and Sevices Tax (GST). This effectively means that the 10 films that released in the state in the last two weeks will be severely affected.

The Tamil Nadu Theatres Association had announced an indefinite shutdown across the state a day before the rollout of the GST. Even last minute talks by producers to resolve the issue on Sunday did not materialise. Tamil Nadu Cinema Theatre Owners Federation president Abirami Ramanathan on Sunday asserted that the theatre hall owners will go ahead with the strike.

Deserted theatre halls in Chennai. (Photo: ANI)

The Tamil film fraternity has already been in turmoil ever since the Goods and Service Tax (GST) was announced by the Central government. GST came into effect on 1 July. The union government replaced the entertainment and service tax with 18 percent GST on movie tickets under Rs 100 and 28 percent GST on tickets that cost more than Rs 100.

What has irked Tamil Nadu Theatres Association is that local bodies want to levy 30 percent municipal tax in addition to GST, which takes the total taxation up to 58% for tickets above Rs 100.

We have announced indefinite strike from Monday because the local body has added 30 percent municipal tax which will make the total tax to come up to 60 percent,” says Panneerselvam, General Secretary, Tamil Nadu Theatre Association. “About 800 theatres are part of the association and we will all be shut from Monday till the local body does not take back this government order.”

This could prove to be a major setback for films which have released this week and have been scheduled for release in July. "The release of all the films will be postponed and the films which released this Friday will not be running from Monday onwards," the General secretary told TNM.

He further pointed out that states like Kerala and Telangana had refrained from charging additional taxes and demanded that the Tamil Nadu government do the same.

(The story was originally published on The News Minute.)