Making tall claims of their films earning Rs. 100 crore may become a thing of the past if government’s new rule of putting an additional service tax of 12.36 per cent on a film’s earning becomes a reality. The news has upset the industry to the extent that the Film and Television Producers Guild of India has decided to go on strike if the government enforces the tax on them. The tax is expected to be effective from this month.
“We are already paying entertainment tax, TDS (tax deducted at source) and income tax and now this additional tax is meant to exploit us further. Ab hume lagta hai…ye humare biwi bachchon par bhi tax laga denge. If this tax comes into force then it will end the film industry, as the movie making will become expensive which will lead to high-ticket prices followed by increase in piracy. Ultimately this will bring an end to the 100 crore era,” says filmmaker Sunil Bohra.
Tanuj Garg, CEO of Balaji Films agrees with Bohra, “This (service tax) will only be counter-productive. It will force people to avoid disclosing real incomes. It will become difficult not just for small producers but also corporates. Projects will become unviable and people will stop investing in films.”
Filmmaker Mukesh Bhatt says that in the year that the industry is celebrating its 100th year, this is uncalled for: “This is the most anti-film industry government since independence. If the government doesn’t listen, we will be compelled to go on a strike.”
Actor Akshay Kumar, too, recently hinted at a strike. “This strike will tell the government that whatever is happening is not right,” he had said.
MORE ON THE ISSUE
Last week, we saw the southern film industry protesting against the government's demand for additional service tax. Now, Bollywood has followed suit. The Hindi film industry has informed the government that no film will release until they roll back the tax demand, reports Mumbai Mirror. The tabloid quoted a source saying: "Not many actors pay their service tax from their pocket. Most of them openly tell the producer that he has to pay them 12.36 per cent over and above their acting fee. This in turn is burdening the producers.” COMPLETE COVERAGE
Rajinikanth goes on a hunger strike
Some of the stars from the Tamil film industry have gone on a hunger strike against being asked to pay additional service tax. Superstar Rajinikanth has also joined the protest.
Known Tamil actors such as Vijay, Sarathkumar, Radhika and Suhasini are also part of the fray.
The tax of 12.36 per cent, they argue, should not apply because the service tax on the entertainment industry was partly lifted a few years ago exempting producers, exhibitors and distributors, reports NDTV. FULL STORY