The Bharatiya Janata Party (BJP)-led Maharashtra government is considering waiving entertainment tax duty for the Global Citizen Festival, featuring British rock band Coldplay, to be held in Mumbai next month.
The state cabinet on Tuesday discussed a proposal put up by the state tourism department for discussion, and decided to form a sub-committee for a final decision.
A senior state government official said, “Legally, the state government is well within rights to waive entertainment duty. Every proposal is circulated across departments, and their comments are a part of the government’s deliberation.”
As per Section 6 (3) of the Entertainment Duty Act, the state government is empowered to exempt any entertainment or class of entertainments from the levy by adopting a general or special order.
Besides a possible entertainment duty exemption, the chief minister-led Mumbai Metropolitan Region Development Authority (MMRDA) has also decided to grant a 75 percent discount in the cost of the venue, the MMRDA grounds at Bandra-Kurla Complex. The MMRDA on Monday handed over about 1.5 lakh square metre land at MMRDA grounds to set up the set, demarcate area for parking, toilets and other facilities. The event organizers are likely to hand back the land by November end, an MMRDA official said.
The Global Citizen Festival works on a model where most tickets are given free of charge for doing social work. Event organizers have told the government that 80 per cent of the tickets to Coldplay’s concert, which will headline the festival, will be given in this manner, while the rest will be charged a fee. The November 19 event will be India’s first Global Citizen Festival and besides Coldplay, will also feature personalities such as Shankar-Ehsan-Loy, Amitabh Bachchan, Arijit Singh, Aamir Khan, AR Rahman, and Katrina Kaif, among others.
Maharashtra Chief Minister Devendra Fadnavis who was present for launching the event in Mumbai last month has offered full support for the festival in the city.
The state revenue department has expressed reservations on the proposal to grant an entertainment tax waiver citing a Bombay high court rap on the state government for granting a similar waiver by the former Shiv Sena-BJP government for a Michael Jackson concert in 1996. In light of the court’s comments, the revenue department said that a waiver cannot be granted at the department’s level.
An official said the state government is considering the entertainment duty waiver, saying it will be calculated only on the 20 per cent tickets charged an admission fee, while the overall benefits be much greater.
“The Michael Jackson event is different from this one as that was just a concert, while this makes an effort to draw a million people towards social work. It is a global festival, so it will immediately elevate Mumbai’s status internationally. It will also draw a large number of tourists that will spur the hospitality industry, consumer spending and add to the state’s kitty through sales tax and Value Added Tax,” he said.