Watching movies in the city will soon become a bit cheaper.
Doling out another sop in an election year, Delhi Finance Minister Dr AK Walia on Tuesday announced that his government has decided to reduce entertainment tax on cinema from 30 to 20 per cent.
Walia said the decision was taken following representations received from the National Association of Motion Picture Exhibitors and the Multiplex Association of India.
Till 2003, entertainment tax on cinema was as high as 60 per cent. It was reduced to 30 per cent in April 2003.
Walia said that collection of entertainment tax from cinemas including theatres and multiplexes has been very robust since the entertainment tax was reduced.
“The collection has gone up from Rs 23.65 crore in 2005-06 to Rs 29.89 crore in 2006-07 and Rs 38.07 crore in 2007-08,” said Walia.
There are at present 56 cinema halls in Delhi out of which 17 are multiplexes. The entertainment tax from cinema sector is 17 per cent of the total entertainment tax collections per year.
The 17 multiplexes account for 80 per cent of the total entertainment tax collected from cinemas.
The rate of entertainment tax is up to 60 per cent in Rajasthan, Uttar Pradesh, Goa, Mumbai and Karnataka. Walia said that Delhi has become the first state to reduce entertainment tax by 40 per cent in the last five years.