Goa entertainment tax on free passes a dampener: Event

The imposition of entertainment tax on free passes distributed by organisers for major events is a dampener for tourism in Goa, industry stakeholders have said.

According to state government officials, entertainment tax on such passes is imposed under the Goa Entertainment Tax Act, 1964.

"Why should there be a tax on free passes being distributed for favours? Sometimes you give free passes out of obligation as part of the contract. But here in Goa, state authorities demanding free passes is becoming a regular feature when big events are held," Savio Messiah, president, Travel and Tourism Association of Goa (TTAG), a union of tour operators, told PTI.

Messiah added that, unfortunately, free passes have become an incentive for the state government to give permission for events.

"If you dont give free passes, they dont give permission," he claimed.

Messiah, a former Goa Football Association president, said this practice of taxing free passes is also taking place for football tournaments.

"When you book a stadium, you have to give free passes to hundreds of people. As per one contract, organisers had to give 1,000 free passes for every match. This is wrong when you are paying for the stadium," he said.

Messiah said he had raised the issue at the state Tourism department's State Level Permission Committee meetings, adding that several complimentary passes are also being misused and sold further.

"The tourism industry is worried as it is contributing to organisers shying away from holding events in Goa," he added.

While Goa Tourism Minister Manohar Ajgaonkar and state Tourism Director Menino D'Souza could not be reached for comments, a senior tourism department official said the Goa Entertainment Tax Act, 1964 lays down that complimentary tickets issued by organisers can be taxed.

"There's an exception to this rule that allows the state to use its discretion and allow exemption on tax on complimentary passes if they don't exceed five per cent of the total capacity," the official said.

Several organisers, however, claimed free passes given out are much more than seven per cent of the crowd capacity.

"We want to follow the law and pay all charges, fees and taxes, but tax on free passes is absurd. We have no option but to fight this injustice," said Manuj Agarwal, chief executive officer, Percept Live, the organisers of Sunburn Electronic Dance Music Festival.

"Sunburn was organised in Goa from 2007 till 2015 a total of nine events. For all these events, Sunburn has paid full entertainment tax on all tickets sold and also on complimentary passes," he said.

He claimed that, between 2011 and 2015, Sunburn had paid over Rs 8 crore in taxes to the state government.

"For all these years, there has been no dispute on the ticket sales. From 2012, the state's Commercial department has levied tax on free tickets," he said.