Bengaluru: The Multiplex Association of India (MAI) has raised concerns over the state govt’s move to impose an additional cess of up to 2% on cinema tickets from Sept 30.The industry body said the extra levy would push up the cost of a movie outing for viewers at a time when theatres were trying to make cinema-going more affordable and win back audiences.According to MAI, Karnataka has close to 1,000 screens, of which around 35% are located in Bengaluru. However, the city alone accounts for nearly 50-55%, and at times up to 60%, of the state’s total box office revenue.Kamal Gianchandani, president of MAI, said the move would hurt the exhibition sector. He pointed out that cinemas were still recovering from the aftermath of Covid, with this being the first post-pandemic year in which theatrical business has done reasonably well. He added that while govt has been pushing for ease of doing business across the country, Karnataka is adding more compliance burden on businesses instead.“To put it in perspective, on a ticket priced at Rs 300, a 2% cess works out to Rs 6, taking the ticket price to Rs 306. As for our next steps, we’re exploring all possible options if govt goes ahead with the proposal,” Gianchandani said.The association also argued that the cess goes against the core principle of the Goods and Services Tax (GST), which was introduced to do away with cascading taxes and create a simplified, unified indirect tax structure. Levying an additional cess on a transaction already covered under GST, MAI said, effectively amounts to a tax-on-tax, defeating the very purpose GST was meant to serve. It called for a more transparent, predictable and simplified tax framework for both consumers and businesses.Devang Sampat, managing director of Cinepolis India, said burdening cinema-goers further was “not the appropriate way forward,” and urged the state govt to reconsider the proposed cess and look at alternative ways to fund welfare initiatives without adding to the tax load on consumers.
