Entertainment Tax Hits Bangalore Cinema Halls

About 50 cinema halls in Bangalore could close if the entertainment tax on non-Kannada films, which is 100 per cent in Karnataka, is not reduced.

The present government has granted full tax exemption to Kannada films but hiked the non-Kannada film tax from 70 per cent to 100 per cent.

"We do understand that the government is trying to boost the Kannada film industry but it is doing so by making others suffer. They should try to promote regional films in some other constructive way. As I see it, about 50 theatres could close down in near future," said joint managing director, Rex and Symphony theatres, Anil K Kapur.

 

"If you see the current trend of taxes, you will see that tax on liquor, cigarettes, have decreased. Entertainment tax in Tamil Nadu has been reduced to 25 per cent," he said.

In 1998, Siddaramaiah had reduced the entertainment tax from 110 per cent to 75 per cent. But it has been increased by the present government. Barring a few upmarket theatres around M G Road, most of the city theatres are doing half the business they used to do.

"We have not hiked up the price of tickets because there will be no takers. How can people pay Rs 60 when it is difficult for them to pay Rs 35?," says spokesperson of Triveni theatre.

Some of the halls are already feeling the pinch of increased tax. "People are coming to the theatres, for it is a place for families to have clean fun. But they do are complaining about the rising prices. Till now we haven't lost many of

our clients because we offer the best service possible and they do appreciate that. But we too are feeling the heat," said Kapur.

At present, the cost of a balcony ticket is Rs 60. Out of this, Rs 30 goes for entertainment tax. Plus they have to pay Rs 7,000 every week as show tax, Rs 1,050 as health cess tax, one per cent of the net projections go as INR, and corporate and income tax.

"If you look at tax collection figures of the government, only entertainment tax has reached the target collection figure. So why tax us more?," says an owner.

On Friday a delegation of the exhibitors and distributors met chief minister S M Krishna. The delegation wanted the government to reduce the entertainment tax to 50 per cent, but is hoping that it would come down to at least 70 per cent.

The matter will be looked into by tax commissioner V Madhu. It is expected that after the budget session is over, the government could consider cutting the taxes to 80 per cent.