1,000 cinemas shut down in Tamil Nadu in protest against tax additional to GST

Around 1,100 cinema halls and multiplexes across Tamil Nadu stopped screening films on Monday with distributors and theatre owners going on an indefinite strike against an additional 30% tax over and above the newly implemented GST.

As the goods and services tax (GST), India’s biggest tax reform, was launched on July 1, the state government slipped in a 30% corporation tax on ticket sales. The tax would cripple the film industry, sources said.

“We are against the corporation tax which is 30%. This is in addition to the GST rates. We are not against the GST. We welcome it,” Tamil Nadu Theatre Owners and Distributors Association president Abhirami Ramanathan said.

The GST replaces more than a dozen central and local levies, unifying India into a common market. It subsumed entertainment tax as well, so the Tamil Nadu government rechristened it as corporation tax, asking cinema owners to pay up.

Ramanathan sought its withdrawal, saying the government in neighbouring Kerala had withdrawn it.

“The tax of 30 per cent is in addition to the GST rates, theatres are shut due to our inability to pay taxes,” he told news agency PTI.

Actor-filmmaker Kamal Haasan said the industry would speak with “one voice” on the decision.

Speaking at the launch of a dubbing studio here on Monday, Haasan told the media, “The entire industry is gathering together and we shall speak as one voice soon.”

Slowly but steadily voices against the decision are getting louder.

“If there is an attempt to create a uniform tax regime across the country, why is Tamil Nadu government alone imposing this huge tax, which amounts to double taxation?” a cine producers’ association member said.

While a Rs 100 ticket in the neighbouring states (Kerala, Andhra Pradesh, Telangana and Karnataka) costs Rs 118 post-GST, it costs Rs 148 in Tamil Nadu.

It is not just the film industry that is under stress in the southern state.

Matchbox and firecracker manufacturers are also on a strike for three days, protesting the 28% GST slab their industries have been put in.

“As it is the firecracker industry is in a bad shape and this heavy burden of higher tax will certainly kill the industry that employs so many people directly and indirectly,” said G Ashokan, a leading manufacturer in Sivakasi.

(With agency inputs)