Few states like Karnataka, Tamil Nadu, and Maharashtra are favoring the respective Cinema industries and the audience by providing tax exemption (Entertainment Tax) for Cinemas.

After the announcement of GST which will be implemented from July 1st 2017 many regional Cinema Industry gave a representation to the Central Government to exempt tax for Cinema Industry. After repeated representation the Central Government has revised the Entertainment Tax.

Under the GST, there will now be two categories for movie tickets. For tickets that cost less than Rs 100, a tax of 18% will be levied. For the tickets costing more than Rs 100, a GST of 28% will be levied.

Presently, entertainment tax is levied by individual states. The states levy a different rate, ranging from 28-110%, and the weighted average for the entire country is about 30%.

However, several state governments give an exemption to cinema of the particular language of that state. Under GST, there will now be no centralised exemption.

Jailtley said:" If states want, through the DBT (Direct Benifit Transfer), the state can refund the GST of regional cinema."

Article Written by - Dayal Padmanabhan