Throwing a broad hint that the government is mulling to incorporate entertainment tax under the Goods and Services Tax (GST) which will go a long way in solving problems faced by filmmakers, information and broadcasting minister Ambika Soni said the levying of a uniform tax regime was a problem in states ruled by BJP and allies.
"Levying of GST would resolve entertainment tax issue as a uniform tax regime would subsume all such taxes. We have been talking about GST for the last three years, however, there is no positive response from the states ruled by the BJP and allies," Soni said.
"Since 2009 I have been speaking to film industry and the finance ministry seeking a slash in entertainment tax."
The film industry has been seeking a slash in entertainment tax which at present is different for all states, sometimes ranging as high as 45-50%. While the Centre is keen on a uniform tax structure, many states are not willing to include all products and services under a single GST regime. Certain products like petroleum or services like entertainment bring high revenues for the states.
Inclusion of entertainment tax under GST, while eating into states' sources of revenue, will be a big incentive for people to watch films besides being of immense support to new film makers.
The opposition to slashing of entertainment taxes or to GST is also because of a wrong image of the film industry.
"Unfortunately there is a wrong image of the film industry which conjures up images of famous film stars and big directors and being a domain of the rich but which is not the reality. We should be really thinking about the new film makers, people who make films with potent social messages or children films," said the minister.