GST impact: Tamil Nadu theatres to go on indefinite strike from Monday

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Summary: The Goods and Services Tax (GST) will result in a drop in the prices of commodities while boosting manufacturing, State Finance Minister D. Jayakumar said on Friday. "All the 950 theatres will remain shut from Monday", said Tamil Nadu Theatre Owners Association joint secretary S Sridhar. The theatre owners are claiming that the lack of clarity on the pricing of movie tickets under the GST regime which began on Saturday is the reason of the sudden strike.

The Tamil Nadu Film Chamber of Commerce, which announced the theatre shut down, demanded clarification from the state government on how much tax would be levied on theatres. The Finance Minister said that the State would be organising a number of awareness programmes regarding GST, which would be held in all districts and zonal regions. This means that a ticket that is costing Rs 120 now, would very easily go up to 178/-. Also, he added that Kerala Government had notified that municipalities would not levy the tax on top of GST.

However, this move has thrown the film industry into a quandary, with producers and directors pointing out that they will face heavy losses because of the strike. He added that the state government should clear the confusion by this weekend on the amount of tax that the theatre owners would be charged. Soon after the GST council fixed the four different rate slabs for goods and services, film trade and business expert Girish Johar, said 28% Entertainment Tax for regional films is high. "It won't be feasible for us as it will affect the livelihood of over 10 lakh families associated with the industry", he said.

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"The tax ceiling is ₹120 and the levy of GST and local body tax seems to be within that".

Though all tax officials are trained in the new tax system and are proficient with the GSTN software application, further refresher programmes have been planned.