Owners of cinema halls wary of tax hike

Talk of reintroducing the Delhi Municipal Corporation (Second Amendment) Bill in the current Budget session has raised the hackles of city cinema hall owners, reports Anuradha Mukherjee.

Talk of reintroducing the Delhi Municipal Corporation (Second Amendment) Bill in the current Budget session has raised the hackles of city cinema hall owners.

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The theatre owners are particularly worried about a section in the Bill that raises the tax on every cinema show to Rs 1,000 from the present Rs 10.

If this change goes through, theatre owners will have to pay Rs 1,000 as tax to municipal bodies for every show they screen, regardless of the number of actual audience.

“At this rate, even multiplexes will close down,” said Shashank Raizada, president, National Association of Motion Picture Association. He said 24 theatres have closed down in the city in the pass decade.

“Only 55 theatres remain in the city and they are not in a very good shape. This includes the biggest names in the industry,” said Raizada, who also owns the iconic Delite Cinema in Daryaganj.

Theatre owners said they would approach chief minister Sheila Dikshit.

“We pay 20 per cent of the ticket rate as entertainment tax. That is the highest tax levied by Delhi government on any product. This is mainly to discourage consumption of molasses, goods with narcotics qualities and alcohol. The show tax has no logic. It is simply taxation twice over,” said Raizada.

“We had given concession to theatre owners in entertainment tax. We will consider their plea in this connection as they are not in very good financial condition. Single screen theatres are worst hit as multiplexes are eating up all the business,” said Walia.

Raizada, however, said multiplexes were forced to crank up the prices of tickets and snacks served in theatres to break even the high operational cost.